Top 10 Reasons for choosing Malaysia as a destination
As investors look for safer havens to put their money after debt crises grip Europe and the US markets and also the China, HK and Singapore market has reached peaked, Malaysia could be the beneficiary of these outside funds.
Part of the attractiveness of Malaysia includes: demographics, rising population, rising income, boosted infrastructure, increasing urbanisation, tourism, undervalued currency and economic restructuring. Limited land, high population in the region, and steady economic growth in turn produce higher incomes, which fuel demand for property developments.
1. Currently, Johor, KL and Penang Island prices are only 1/10 of Hong Kong . Avg price is 1500-2500 hkd psf based on Net area, and all have free car park space included. Household incomes are less than 10 years to buy property whereas HK need 35 years . The prices are expected to continue upward and in 2020 the demand outstrip the supply with the current population growth. In greater KL, the expected population is to rise from 7.5 million to 10 million by 2020.
2. Favourable economic conditions in Johor, Penang and Malaysia. Many infrastructure and also Economic Transform Program of Malaysia will mean in the next 5 years, it will move into a developed and high income nation. Also the forces from China and Asia together with the One Belt One Road, means tremendous growth of the middle class . It is estimated that 64% of middle class resides in Asia by 2030.
3. Malaysian property market has long been for last 20 years on a steady upward trend. Unlike the HK volatility. It is a safe haven in turbulent times. Property in Malaysia has been robust in last 20 years and has been rising slowly and healthily compared with other nations.
4. Top 10 places to Retire in the world. A high standard of living but at a very low living cost makes Malaysia tick of all the boxes in a place for retirement. Penang is the only place in Asia according to a survey. There are many retired expats on the Malaysia My Second Home program(MM2H) resided in the northern tip of Penang Island coming from UK and Australia. And many Chinese in the SE Asia (esp Singapore, Indonesia) are choosing KL , Penang and Johor to call home when they retire. With the Malaysia My Second Home program, it makes sense to invest in Malaysia as a second home.
5. Easy to communicate in Chinese or English. This helps to bring in China and other parts of the world to invest in its nation and its properties. After HK, Singapore, Australia, Malaysia, Taiwan, it is expected that KL, Penang and Johor would be their next target.
6. Living standard is high but living costs are low. Flying to and from Malaysia to HK are a breeze, only 3hr 30 mins and airlines will take you round trip for only around $1800.
7. Food is delicious in Malaysia, with many tasty local delights. Suitable for HK tastes.
8. Most projects are Freehold or 99 years Leasehold in Malaysia, not like HK or China leasehold till 2047 or 70 years. And best of all, no estate duty in Malaysia and are foreigners house purchases are protected by law.
9.In terms of many places in the world like Vancover, Sydney, London, Australia, New Zealand, Hong Kong, Singapore and China first tier cities are massively overvalued, many smart investors has been transfering money to buy Malaysia as a second home as it is still welcoming foreigners and can loan up to 70% .
10. Malaysia Ringgit is now lowest in 10 years and expected to appreciate. Mark Mobius , Franklin Templeton has said that the Ringgit is undervalued by 28% (march 15 2016). Malaysia has strong flows of FDI in its infrastructure and high tech industries generating housing demands and also a rising population in the next 10 years. The ringgit will expect to strengthen when the oil prices that will be trending up again in the next rally.
Real Property gains tax for foreigners on profits on Selling price are 5% after 5 years, and 30% within 5 years. Foreigers from 2014 Jan will have to buy RM 1 million and above. Each state has its own state consent rules , fees and levies , and it is suggested to contact us for more information.
Other important points include:
One of the fastest growing economies in the region (+5% est.)
British legal system, property laws and environment
property ownership and security of title
Active government incentives (Malaysia My Second Home Programme) encouraging foreign homebuyers to the country through offering 10 year entry permits
Attractive, well-priced properties with strong rental demand
Low buying costs
Strong capital growth of between 15 and 30%
Effective Land Registry and transparency in property transactions
Tax advantages: remittances of income from overseas are TAX FREE
Car import duties and other taxes are waived for foreign residents who are in MM2H
No capital gains tax on unearned income inside the country
No requirement, as in neighbouring countries, for a company or local “partners” to buy property
Capital gains on real property are only 5% after 5 years
Strong demand for resale properties from locals moving to the cities, rising middle class
Also a high demand for quality new real estate is high from an affluent expatriate market. Meaning good rental yields in expat areas such as KL. Yield around 5% can be achieved.
Among the top three countries for the greatest number of tourist arrivals among the 53 Commonwealth countries, according to the World Tourism Organisation.
Chinese investors already active in the market and this is expected to grow much much more with penetration of One Belt One Road and also with China developers now moving in.
Good, modern communications and infrastructure country-wide
Government of Malaysia aims to further improve the infrastructure like MRT and high speed rails and analysts believe this will have a positive impact on the Malaysian real estate market.
The value of the local currency, the ringgit, is far below the euro, dollar and pound sterling, allowing foreign investors to buy a lot more for their money in Malaysia.
Low cost of living
Low cost of regional flights on Air Asia to major S.E. Asian cities
High quality development properties in prime areas are now available at low prices compared to Asean countries
Strategic location – close to Australia, Bali and Singapore. Centre of the Earth, centre of Asia.
English language widely spoken and all property sale agreements in English
English language newspapers, radio and television available everywhere
Wonderful climate and food. Superb golf and other sports facilities.
Extensive white sandy beaches continue to draw holidaymakers.