It said at end-2016, about 56% of loans outstanding were for houses priced below RM250,000, while loans for houses priced between RM250,000 and RM500,000 accounted for another 25%.
Rejection rates for housing loan applications also fell further to 23.6% in 2016 (2012-2015: 26.1%).
These trends are evidence that financing remains ample for eligible homebuyers, it said in its Annual Report 2016 released here today.
Similarly, house builders continue to have access to bank financing.
Loans for real estate activities and residential property construction increased at a healthy rate of 11.7% in 2016 (2012-2014: 18.5%), reflecting fewer property launches and incoming supply.
“As for end-financing, as in other countries, the central bank has introduced macro-prudential measures to deter speculative activity in the housing market and to avoid over-borrowing beyond one’s means,” the annual report said.
It is important to note that these measures do not, in any way, hamper access to financing for eligible borrowers including those who are first-time buyers, it said.
BNM said access to affordable housing was more of a demand-supply issue rather than the general perception of lack of access to financing.
On the supply side, the housing market has not provided an adequate supply of affordable housing for lower- and middle-income households.
In 2014, the shortage of affordable houses was estimated to be 960,000 and set to increase to more than one million units by 2020, Bank Negara Malaysia (BNM) said
“While there are multiple programmes by the private sector, federal and state governments to supply affordable housing, the current level of house-building is not sufficient to meet demand,” it said.
The supply-demand for affordable housing worsened during the 2012-2014 period.
The effect of the supply shortfall on housing affordability was exacerbated by the slower increase in household incomes relative to house prices, said BNM.
Another factor which worsened housing affordability was the trend in launching houses priced above RM250,000.
“While there were more launches during 2012-2014, the number of new affordable housing units for households earning the median income (below RM250,000) was fewer by 16,200 units per year since the period 2008-2009,” it said.
The oversupply of higher-end properties beyond what households can afford resulted in a significant portion of these non-affordable properties remaining unsold, said the central bank.
“The housing market in Malaysia has not been able to provide an adequate supply of affordable housing for the masses.
“This undersupply of affordable homes is likely to worsen, going forward, given the current trends in income and demographic factors,” it warned.
Among the measures it listed to tackle the issue was by reducing costs associated with the development of affordable housing.
Implementing cost-saving and productivity-enhancing technologies would increase the speed and scale of delivery of affordable housing projects, it said.
On the demand side, the development of the rental market to bridge the affordability gap could relieve some pressure on the government to build all of the affordable housing needed.
“This should be complemented by more innovative schemes to fund the delivery of affordable houses.”