Affordable Housing Hacks - 5 Tips Every Young Malaysian Should Know.

For many young Malaysians stepping into the workforce, one of the most significant goals is purchasing their first home. While buying a car may feel like an easier milestone, owning a home often presents more complex challenges—loan applications, deposit payments, and long-term financial planning among them.

In fact, it can be achievable if one is to explore the many options of schemes and financial assistance  to help turn that dream into reality:

Explore government schemes designed to assist first-time buyers.

Such as PR1MA, PPAM (Eligible For Civil Servants), RUMAWiP (Provide affordable housing across FederalTerritories including KL, Putrajaya and Labuan), Rumah SelangorKU (Eligible only for Selangorians) 

PR1MA is only one of the government initiatives under Perbadanan PR1MA Malaysia, offering schemes across the state. For Malaysian applications aged 21 and above with a household income between RM2,500 and RM15,000 per month amd house pricing offered are from RM100,000 and RM400,000. These projects are developed in key urban and suburban areas across including apartments, terrace houses, and townhouses, making it a pathway for first-time homeowners.

The rest of the scheme, some are specific to states, territories and other requirements.

Leveraging on EPF withdrawals.

EPF offers a range of withdrawal options designed to help ease the financial challenges of purchasing one’s dream home. From buying a house and renovating it to paying monthly installments for housing loan reductions.

For withdrawal through EPF it is solely for residential home purchase and loan approved by a recognised financier or self-financed,, one must be below 55 years old.and a minimum of RM500K must be available in your Sejahtera account..

Consider affordable options like high-rise homes or properties in up-and-coming areas.

One of the good examples is Negeri Sembilan, with its proximity to Kuala Lumpur it is gaining popularity as an affordable alternative for homebuyers —just about an hour's drive via the North-South Expressway (PLUS)—it offers a more budget-friendly option for those working in the city but preferring a quieter, more affordable place to live and price ranges for a terrace landed range between 350K - 500K. 

Strengthen your credit score for smoother loan approvals.

Banks prioritize borrowers with a consistent record of on-time payments with minimal late payments and default payments.

It is important that you have a healthy credit history, including loans, credit cards, payment behavior, and any outstanding balances as banks usually will check on your health status through the Central Credit Reference Information System (CCRIS) managed by Bank Negara.

On top of that, banks also use CTOS scores to assess creditworthiness. CTOS is a private credit reporting agency that compiles your credit information, including legal actions (e.g., bankruptcy), payment history, and debts. 

Keep a healthy DSR (Debt to Service Ratio) to determine how much of your income is used to service debts. A lower DSR indicates better financial health.

Start small with a manageable starter home and work your way up

For growing families, small families, or individuals starting out, a starter home is often the ideal choice. New homeowners typically opt for a manageable square footage and a loan that fits comfortably within their budget. It’s a smart way to kickstart your homeownership journey.