The Current Housing Schemes Available for B40 and M40 (Updated 2021)

by | i-Stories, Property Trend, Rental Trend

Purchasing a property can be difficult, especially during these challenging times with the MCO impacting the Malaysian property market.  However, if you are in the B40 or M40 group, you are not alone or without help.

One helpful piece of advice we can give to those in desperate need of help is to rely on the many housing incentives provided to assist the B40 and M40 income groups.

But before anything, are you even eligible to apply for these B40 and M40 housing schemes? Do you know where your household’s group is in the income classification?

The New B40, M40 and T20 Income Classification

The New B40, M40 and T20 Income Classification

The terms B40, M40 and T20, shouldn’t be foreign to most Malaysians. The government mainly uses the income classification as a basis for their initiatives, especially for the B40 group.

These are the income groups where Malaysians are classified based on the median monthly income per household.

Though many believe that it is rigid, the income level may change over time as the median monthly income normally rises and declines per year.

You can explore the official statistics further in the Household Income and Basic Amenities Survey Report 2019 prepared by the Department of Statistics (DOSM).

To make things easier to understand, we created a table that delineated the latest income classification.

Income Group Median Income 2020 (RM)
Bottom 40% (B40) B1: Below RM2,500
B2: RM2,501-RM3,169
B3: RM3,170-RM3,969
B4: RM3,970-RM4,849
Middle 40% (M40) M1: RM4,850-RM5,879
M2: RM5,880-RM7,099
M3: RM7,110-RM8,699
M4: 8,700-RM10,959
Top 20% (T20) T1: RM10,961-RM15,039
T2: RM15,040 and above

But, of course, these are not entirely accurate to every part of Malaysia. 

We should include many factors when discussing income classification, specifically urbanisation. With the significant contrast in living expenditures, what may be sufficient for a small home in Perak would not be enough for a similar-sized household in Kuala Lumpur.

The statistics by DOSM indicates that the median income at the state level differs. Kuala Lumpur has the highest median income with RM10,549, Putrajaya with RM9,983 and Selangor with RM8,210.

In contrast, the bottom three median incomes by state level are Kelantan at RM3,563, Sabah at RM4,235, and Perak at RM4,273.

B40 and M40: Housing Options Based on Your Income Levels

The B40 group has minimal housing options, understandably so with the slow rise of wages, increasing cost of living, and rising property values. Nevertheless, various housing incentives can help the B40 group obtain their own property.

However, this raises an issue for those at the B40 margin, particularly those barely over the M40 threshold. These M40 households may believe that help is out of reach because they aren’t eligible for the same advantages that B40 households can enjoy.

But don’t worry! Here, we have listed several valuable housing schemes for those in both the B40 and M40 groups!

B40 and M40-Housing Options Based on Your Income Levels

1. Bank Negara Malaysia’s RM1 Billion Fund For Affordable Homes

Bank Negara Malaysia’s (BNM) financing scheme, established in 2019, had a recent enhancement to assist lower-income homebuyers in affording their first houses. The following is a list of the fund’s features:

  • Stamp duty exemption
  • Support for the down payment
  • Waived processing fee for financial applications
  • The extension of the loan repayment duration to a maximum of 40 years, or until the applicant reaches 70
  • Financing rates of up to 3.5% per year (which is relatively low when compared to most that charge a minimum of 5%)
  • Not to mention, AKPK (Credit Counselling and Debt Management Agency) is offering free financial education to help homebuyers grasp the financial essentials of buying a property.

Additionally, buyers previously only qualified to the scheme if the property costs less than RM150,000 and their monthly household income was less than RM2,300.

But the maximum property price has recently been raised to RM300,000, while the monthly household income boosted to RM4,360!

2. Bank Simpanan Nasional’s MyHome (Program Perumahan Rakyat)

Bank Simpanan Nasional (BSN) has devised a helpful housing scheme, BSN MyHome, aiming to financially help self-employed individuals to support Malaysians acquiring their first property.

Surely everyone understands how challenging it can be to get a house loan while being self-employed. With the unpredictable and harsh circumstances COVID-19 has brought, self-employed homebuyers couldn’t have had it much more complicated than today.

The scheme financially assists the purchase of one’s first house, though it is for own-stay only. It has several advantages, including:

  • Giving you the option of using an individual or shared home loan, providing you with the freedom to access extra funding if you need it
  • Up to 100% financing (including mortgage insurance, MRTA or MRTT)
  • Requiring only a minimum income of RM1,000 per month
  • Covering the stamp duty

3. Rent-to-Own (RTO) Scheme

Tabled in Budget 2021, the Rent-to-Own (RTO) scheme allows Malaysians to rent out their homes with the potential of selling them afterwards. In other words, you can test the house before you purchase, kind of like a test drive!

The RTO scheme is only eligible for first-time homebuyers and houses priced at less than RM500,000. With RTO, homebuyers who don’t have the financial means to pay the required 10% down payment, or are not qualified for loan financing, are given a chance to acquire a property.

Instead of making a down payment, they can opt to join a lease agreement and rent the home for up to 5 years.

Most importantly, after the first year, the buyer can buy the home for the same sum as when they first signed the lease!

You might be wondering, what are the current initiatives of RTO you can apply? Well, Maybank HouzKEY, PR1MA, and Smart Sewa are just a few of the current rent-to-own programmes offered in Malaysia. Learn more by visiting the official websites!

4. KPKT’s Youth Transit Housing (MyTransit)

The Youth Transit Housing Scheme (MyTransit) by the Ministry of Housing and Local Government (KPKT) targets to assist single and married youngsters in the B40 and bottom-M40 range.

The programme assists young adults by offering cheap studio flats for rent rather than purchase.

KPKT planned to build 2,010 studio dwelling units in Mukim Kepong and Mukim Batu, Kuala Lumpur, with an expected completion date of 2022. KPKT also planned these properties to have a rental rate at least 20% lower than market rates!

There’s also a “forced savings” feature. When the maximum five-year lease period has expired, a portion of the monthly rental will be set aside and given to the renter in a lump amount.

It is useful to stay informed about our financial circumstances and the programmes and incentives we may be entitled to. If you are in the B40 or M40 groups, you would appreciate these opportunities that support the low-income groups and not leave them in the dark.

If you are still hesitating on these schemes, you can explore more property options and assistance with our Rumah-i App on Google Play or App Store. We’ll bet we can find the perfect place for you to settle in!


- Entitle ONE time rental collection service for free

- Rental collection service for free is limited to FIRST 1,000 properties which engage the service and is for pre-launch registered owners only.

- Tenancy agreement must be prepared by Rumah-i.