The answer depends on your individual circumstances, risk appetite, mortgage terms, investment horizon and your expectations for how home prices behave over the five years.
To buy a 3-bedroom apartment costing RM300,000, a homebuyer under both options needs to pay RM60,000 upfront. Over the next five years, with a mortgage, you need to keep up with RM1,216 in monthly repayments. With FundMyHome, there is no monthly repayment.
By the end of the fifth year, with a mortgage, you would have paid nearly RM132,960 and still owe RM218,779. Under FundMyHome, you would have paid only RM60,000 and have a balance of RM240,000 outstanding.
Another way of looking at it is that the amount already paid plus the outstanding loan payable would be RM351,739 under a bank mortgage. Under FundMyHome, the equivalent amount is only RM300,000 or nearly RM52,000 cheaper. This is because much of the payments in the early years under a mortgage went towards interest.
However, should home prices rise by more than 17%, you would be better off with a normal mortgage. On the other hand, the risk of losses due to a fall in home prices is much higher under a mortgage. With FundMyHome, your loss is limited to the capital you invested, which is 20% of the original house price.
In summary, if you have the access to a bank mortgage, prefer not to share your capital gains and do not mind bearing all the loss as well, FundMyHome is not for you.
On the other hand, if you do not have access to a bank mortgage, are willing to share your capital gains and mitigate your potential loss, then FundMyHome may be for you.