Real estate platform IQI released data showing financial returns to homeowners, revealing that Malaysians who own their own home have become significantly richer through home price growth.
Juwai IQI Co-Founder and Group CEO Kashif Ansari explained, "The median homeowner in Malaysia saw the value of their home climb by RM136,716 during the 10 years to 2023. That's an increase of 42%. Median prices increased from RM330,427 in 2014 up to RM467,143 in 2023.
"The typical Malaysian homeowner saw their personal wealth soar by the equivalent to more than four years of wages – just because their homes went up in value. The Department of Statistics pegs the median annual formal wage at RM32,000. "The data shows that, if you can sustainably afford to own your own home, it can be one of the simplest and safest routes to attaining financial security.
"All of these calculations are based on median home price data from the National Property Information Centre."
Among the states that saw the most significant and fastes rise was Selangor where homeowners saw the value of their homes soar by RM169,091. Sarawak was secodn with median home price climbing by RM152,016. The third biggest gaining state was Johor, with a price gain of RM147,363.
As for Kuala Lumpur, IQI said prices climbed RM145,523 between 2014 and 2023, and in Negeri Sembilan home prices jumped RM128,943. Kelantan, the starting price was lower, but home prices had a bigger percentage gain seeing home prices surging by 70% over the 10 years, by RM105,537.
"Kelantan wasn't the only state with impressive returns in percentage terms. Melaka, Negeri Sembilan, and Kedah all rewarded homeowners with a 69% gain in home values. Perak, Johor, and Perlis also all saw the value of homes grow by more than 50% said Ansari.
Homeowners who hold a mortgage fared even better. While the median Malaysian property price increased by 42%, mortgage holders earned a larger return or 66% on the money they put into their home over 10 years. Mortgage holders get the benefit of the entire price gain even though they didn't have to invest the full value of the house when purchasing it. In effect, they
are using the bank's money to leverage the price gains to a higher percentage return.
The states where mortgaged home buyers earned the biggest returns on the actual ringgit are Kelantan (113%), Melaka (111%), Negeri Sembilan (111%), and Kedah (110%). Homeowners in all these states more than doubled their money.