Making the Most of Malaysia
Property Life News, APRIL MAY 2014
'Malaysia My Second Home' or MM2H as it is known is creating a stir amongst property investors looking for a home in the region. Already one of the top 3 destinations to retire in the world, the country seems to be making an all-out effort to leverage stunning natural scenery, highly competitive pricing, a rapidly developing infrastructure and a low cost of living to secure its place as a choice of living to secure its place as a choice destination for those in search of landed property in South East Asia.
The MM2H programme offers non-Malaysians an attractive ten years renewable visa and other privileges in return for their commitment to the country. The programme is primarily attracting people who wish to spend their retirement years in Malaysia or who want to make Malaysia their home base for extended periods of time. More than 12,000 people have been approved so far, and the numbers are expected to grow exponentially as more property becomes available in sought after areas of the country. Ongoing development of regions such as Johor in Iskandar, which is only a 30 minute drive (barring rush hour congestion) across the causeway spanning the Johor Strait and Singapore is increasing the attractiveness of Malaysia.
Investors who are considering taking advantage of the enlightened attitude and largesse of the Malaysian government will be pleasantly surprised at the variety of landed properties for sale throughout the country. There are several hot spot for foreign investment in landed property throughout Malaysia.
Malaysia's "My Second Home" initiative is being touted as a model for attracting foreign model investment to countries across South East Asia- and a core component is property investment
Many of these desirable locations are clustered around Kuala Lumpur, Malaysia's national capital. Kuala Lumpur. Kuala Lumpur is also the country's primary cultural business and financial centre. However, the lure of Malaysia's lengthy coastline (a total 4,538 km), diverse cultures, varied scenery and vast offshore island archipelago possessions all sound siren calls for those who want to experience the many moods of the region.
Taking advantage of this growth comes with a caveat for foreign buyers; you're going to have to spend a minimum of RM 1m (USD S$303,000) on a property to enter the market. Given that the Malaysian Ringgit is trading at around 2.6 to the Singapore Dollar and that different barriers (including cost) to entry for foreign property ownership in the two countries exist, Malaysian property is worthy of serious consideration.
Malaysia Regional Analysis
Kuala Lumpur/ Klang Valley
The capital city of Malaysia is often the destination of choice for expats. Kuala Lumpur has a vibrant night lift and a deliciously eclectic culinary scene, great shopping opportunities and access to all the amenities, including private schools and clubs. Factor in a rapidly developing urban rail system and the popularity of the capital city and its environs is no surprise.
Landed property in or near the city centre is an expensive option and the ever improving public transport network aside, you're going to need a car if you live some distance from your place of work. Traffic can be an absolute killer. It's a testament to the foregiving nature of the Malaysian populace that road rage is not the national sport. The Klang Valley near KL has also become increasingly popular with foreign investors.
Klang Valley neighbourhoods range from lush green suburbs set in rolling hills to vibrant townships to villas in gated communities.
Landed homes in the area remain popular with prices for double-storey units hovering around the RM1M (US $319,5k) mark in KL suburbs such as Petaling Jaya, Damansara and Bangsar.
Scarcity of land in these prime locations and pent-up demand is expected to drive prices higher.
Penang
This island is a world away from the bustle of the capital. As a popular choice for weekenders and retirees, Penang offers a more laid back lifestyle and some of the best food in Malaysia.
The expat community is small, but growing and housing is cheaper there in in Kuala Lumpur and surrounding (but this is changing fast). There are a wide array of houses, bungalows and new developments to choose from.
Malacca
The port of Malacca with its historic waterfront is widely recognised as a gem in Malaysia's crown. The expat community in Malacca is quite small but growing as educational options become more varied and infrastructure development takes place.
Although the entry prices for landed property in Malacca remain reasonable, especially in relation to property prices in neighbouring Singapore, rapid development is driving prices higher.
Kota Kinabalu
Kota Kinabalu in East Malaysia faces the South China Sea in the shadow of South East Asia's largest mountain, Mount Kinabalu. As the capital of Sabah (one of the two states on the island of Borneo), this city is gradually attaining a cosmopolitan air, while retaining a reputation for the laid back lifestyle. KK has a growing expat population. Landed property prices in KK have more than doubled in the last 5 years, putting many properties beyond the reach of lower to middle income earners in Malaysia.
Johor / Iskandar Malaysia
Worthy of inclusion into the most sought after areas for landed property investment is the main southern development corridor, Iskandar Malaysia, which is only 30 minutes from Singapore.
The classic hockey stick graph would best describe the process of Iskandar Malaysia properties, but new measures aimed at heading off a potential property bubble may slow rampant investment. Rules governing real capital gains tax and minimum investments by foreigners may go some way to curbing the unbridled excitement surrounding investment in the region.
It is easy to fall in love with Malaysia. A bubbly melting-pot of races and religions it is a festive and sometimes dangerously flirtatious younger niece of the staid but safe and squeaky clean aunt across Singapore Strait. It is a country that can reward a variety of investors, as well as those in search of a South East Asian home base. It is definitely worth exploring, especially given the attractiveness of the Malaysian My Second Home programme.