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#HiHOME #HiHOME2019 Dr. Daniele Gambero: The Affordability Tale – Understanding the Problem and Available Solutions

The first speaker, Dr. Daniele Gambero started by stating that there many issues in the country of Malaysia such as property overhang, young Malaysians struggling with financial savviness etc. His presentation radiated a strong belief that Malaysia has a lot of hope and potential based on the Big Data Numbers.

He dived into the issue of affordability by sharing that a house can be called affordable when the household living in it will need less than 35% of its net income to repay the mortgage. Many people are actually going out of their way to make their life work. Approximately 80,000 people commute on a daily basis from Seremban-KL due to lack of affrdable homes within KL.

The Future projection of buyers & Factors driving housing Demand

Dr. Daniele expresses that by 2020, Malaysia’s Population Pyramid will show that we have 32.5 Million Malaysians searching for a home.  He later concluded that in another 20 years, we will have 6 Million more people searching for property,making it 38.6 Million Malaysians.

Another factor is that Malaysians are moving out of lesser developed areas into more urbanised areas. That, coupled with an Increased life expectancy, shows a future where we will need more housing facilities.

As of 2014, Malaysians ownership stands at 76.1% and in the near future it is realistic to move to a higher 80%. Dr. Daniele feels that this is possible due to the fact that Malaysia’s National Household Income is at a Median of RM5,228. This makes us 2nd highest in the South East Asia, after Singapore which is a figure almost double the amount compared to the other countries in the region.

In other words, we need to focus on increasing the National Median with the vast new opportunities made available to us such as, FINTECH, Fish TECH and etc. Another area of equal importance is to be able to address homeownership issues on a state by state basis based on capacity of the households within that state

Solutions Moving Forward

To close, he posed a question. Is there a Happy Ending for Malaysia? Yes, this is definitely possible, providing we adhere to the following efforts:

We need to address the root of the problem by reducing the costs of constructing and rising the per-capita income
We take every opportunity to analyse what other developed countries such as the EU has implemented for similar issues.
Moving deeper into Property Tokenisation to introduce the concept of fractional ownership.
The development of a Real Rent to buy scheme. There are many models that can be done in a profitable way for all parties

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