Increasing housing prices in Perak has made it difficult for homebuyers to own affordable housing. Housing affordability ensures that housing provided is affordable for every income group, especially the low and middle-income groups. It has brought the government and housing developers’ attention the issue of housing affordability by supplying public low-cost housing schemes. The traditional measurement of housing affordability is by using the percentage of household income spent on housing. The important cost that is usually ignored in measuring housing affordability is transportation costs. Housing and transportation are the two largest expenses for most households. This paper aims to determine the factors affecting housing affordability by including transportation expenditures. A total of 65 questionnaires were distributed to the homebuyers in Perak Tengah. The multiple linear regression was conducted, and the results revealed that locational, neighborhood, structural and financial were significant factors influencing housing affordability. It also showed that including transportation expenditure into the calculation of housing affordability can reveal true housing affordability measurement.
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