Housing affordability is a global concern plaguing key cities around the world in both developing and advanced economies. The key drivers include the rise in income growth and urbanization, driven by better job opportunities in cities. Affordable housing is defined as housing which is sufficient in quality and location, and is not so costly that it prevents its occupants from satisfying other basic living needs. In other words, the location, quality and build-up of a house is equally as important as the financial affordability of a house. In 2014, the McKinsey Global Institute estimated that 330 million urban households globally live in substandard housing or are financially stretched by housing costs. Malaysia faces a similar issue in this regard. A number of reasons encompassing structural, cyclical, institutional and cultural factors, culminating in a mismatch between supply and demand, has contributed towards houses becoming seriously unaffordable in Malaysia in 2016. Consequently, Malaysia faces a shortage of affordable homes for the masses. This box article focuses on drawing out for public discussion, several policy propositions as a way forward in addressing this challenge. n 2016, houses in Malaysia remain seriously unaffordable by international standards with a median multiple2 of 5.0. The maximum affordable house price in Malaysia is estimated to be RM282,0003. However, actual median house price was RM313,000, beyond the means of many households, where the median national household income is only RM5,228. The housing affordability issue in Malaysia is largely due to the supply-demand mismatch and slower income growth. Financing continued to be available for purchases of houses for eligible borrowers, with more than 70% of housing loans accorded to first-time buyers and close to two-thirds of new housing loans channeled to the purchase of houses below RM500,0004. On the supply side, structural and cyclical factors in the housing market in Malaysia have resulted in a failure of the market to provide an adequate supply of affordable housing for the masses (Figure 1). On the demand side, growth in household income has not kept up with the rise in house prices. Together with a low state of financial literacy amongst a majority of Malaysian households, and a cultural preference towards home-ownership instead of renting, these have contributed to the high demand for house purchases.