The Useful Guideline for Foreigners to Purchase Property in Malaysia

Malaysia is one of the countries in Asia where it is flexible to purchase a property as a foreigner in terms of legal matters attached with buying a property. In this guideline, we will provide the reasons why you should make a move in getting a Malaysian property and the restrictions applied for foreigner to buy the property in Malaysia.

Reasons to Purchase Malaysian Property

1. Low purchasing costs

The purchasing costs in Malaysia are about 4% - 5%, which are relatively lower than countries like Australia, Thailand and Singapore.

2. Numerous financing options for foreigners

The banks in Malaysia do finance foreigners who want to purchase a property in Malaysia. In addition, there is no restrictions in Malaysia to transfer the money from or to other countries.

3. Affordable and competitive property price

Although the price of the properties in Malaysia has been growing in recent years, Malaysia properties remain as one of the cheapest among Asian countries like Singapore and Hong Kong. Moreover, Malaysia currency is weaker in comparison to other currencies, which gives an advantage to foreigners to get a cheaper property.

4. Free from major natural disasters such as earthquakes and volcanoes

The strategic location of Malaysia provides a peaceful living, which you do not need to worry about natural disasters.

Sounds attractive? So for now you would have to know what are the requirements for foreigners to purchase a property in Malaysia. Generally foreigners are allowed to purchase the property in Malaysia, but there are some rules and regulations that they have to be aware of.

Restrictions to Purchase Malaysian Property

1. The approval to buy a property in Malaysia

If the property purchase price is less than RM 20,000,000, foreign buyers do not need to obtain an approval to purchase from Foreign Investment Committee (FIC). However, they are still required to obtain an approval from the respective State Authority, comply with the minimum purchase price set by every State Government.

2. The minimum purchase price for foreigners

The Malaysian Federal Government has imposed the minimum purchase price of RM 1,000,000 on foreigners since 2014. However, you have to know that every State Government in Malaysia also imposed their own purchase restriction and the minimum purchase price set by the State Government will be prioritized. For example, Selangor State Government has imposed a minimum purchase price of RM 2,000,000 and it is only permitted for properties with strata title (i.e. condominiums and landed properties in a gated community). Hence, it is important to know the location and title of the property that you want to check the minimum purchase price imposed.

3. The types of property that foreigners are not allowed to buy in Malaysia

In Malaysia, foreigners are allowed to own any types of property except the following:

(a)   Malay Reserve Land

Properties built on the Malay Reserve Land is not purchasable by any other races except for Bumiputeras.

(b)   Low-to-medium costs properties

Foreigners are not allowed to buy properties under this category, which are determined by the State Authority. 

(c)   Bumi Lots

Bumi Lots are properties allocated to Bumiputeras for property development project, which are determined by State Authority.

(d)   Agricultural Land

Most of the agricultural lands are not able to be purchased by foreigners.

For more information regarding the rules and regulations to purchase a Malaysian property, please do not hesitate to consult us.

If you have any questions or would like to arrange a viewing, please feel free to contact us!

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