How To Buy Property In Malaysia As A Foreigner

Tuesday, August 1, 2017



How To Buy Property In Malaysia As A Foreigner  | Malaysians are friendly people and always ready to welcome foreigners in the country. Most foreigners are either tourists or expatriates. The government has also been encouraging foreigners to settle in the country as a second home for investment purposes, retirement, and long-term stay. However, as a foreigner, you have to understand various legal fees and policies the government has imposed on house for sale in Malaysia before making your investment decision. Not every property is available for foreigners and the state imposes the minimum purchase value. You should also know the various property financing options in the country. 


Property titles in Malaysia 



Only two types of property titles are available for foreigners designing to invest in the country. The first title is the Freehold property, which provides the property owner with full, permanent property ownership. The second category is the leasehold title, which allows foreigners to own a property for a limited period. Mostly, leasehold titles have a maximum period of 99 years but the owner can extend the period by paying an additional amount. 

A house gets a title after completion. However, owners of condominiums and apartments receive “strata title.” If you desire to build a new apartment, you might not get the strata title for a certain period after the building completion.

Property sale and purchase agreement in Malaysia 

Sale and Purchase Agreement is the agreement between the seller and buyer of a property in Malaysia. If your property purchase involves subsequent hands, known as sub-sale transactions, hiring a lawyer is advisable mainly because he will look after all your interests and handle the transaction. Sub-sale agreements highly vary depending on situations surrounding a case. When buying directly from property developers, the Housing Development (Control and Licensing) Act should protect your interests. 



State approvals 

Mostly, the state consent takes more than six months. As a foreigner, you should not get the Foreign Investment Committee (FIC) approval. However, you should get approval from the relevant State Authorities. When getting an approval, you have to consider several factors including:

-Location of that property you intend to buy
-Type of the property you are intending to buy
-Type of development you intend to undertake
-Percentage of units owned by foreigners within the location
-Types of properties you can own as a foreigner 

Apart from the minimum price thresholds, foreigners cannot purchase some types of property in Malaysia. In Malaysia, foreign property ownership is liberal. In other words, a foreigner can own 100% of a property. However, for that to apply, they have to fulfill all the requirements. A foreigner can own any type of property excluding:


  • Malay Reserve Land: 

The Malay Reserve Land is a type of land that is only sold to the Bumiputeras. 

Bumi Lots: most people confuse the Bumi Lots with Malay Reserve Land. Every property development in the country has specific quotes for Bumiputras known as “Bumi Lots.” Even though the non-Bumis get chances to buy the properties from time to time, foreign investors can never buy them. 

  • Low to Medium Cost Properties:

As a foreigner, you will not get a chance to buy the low-to-medium cost properties in the country. The state determines the properties that are under this category but they are mostly flats. 

  • Agricultural land: 

Foreigners cannot buy most of the agricultural properties in Malaysia
(Properties that have a value below RM1 Million )

Low-to-medium cost properties and Bumi Lots are not easy to identify. Therefore, you have to learn the differences between the two before you start your property buying process. And to avoid most of the challenges associated with land purchase in the country, you might need to engage the services of a property lawyer. 



Buying property as a Malaysia My Second Home Visa Holder


If you are planning to move to Malaysia as a Malaysia My Second Home Visa Holder, you will have to make a Fixed Deposit. That is if you have already purchased a property exceeding RM1 Million value before applying for the MM2H Visa and the property has no encumbrances. 

But if you happen to buy a property after you have obtained the MM2H visa, then you will have the chance of withdrawing the money after 12 months – you have to prove that you have bought a property in Malaysia. People who buy properties after obtaining the MM2H Visa can buy any property regardless of the value, and they can use a loan to finance their property purchase. 
For that to happen, they must deposit an amount exceeding the amount they wish to withdraw from their Fixed Deposit. 

Is an MM2H Visa important during a property purchase?

You do not need to enroll to the MM2H Visa program when buying a property in Malaysia. Some foreigners also choose to rent properties. Properties in the country are cheaper as compared to the properties in most other developed countries. And regardless of the new developments explosion, the prices are not increasing. 

Most of the expensive properties are in Central KL. But because the MM2H program is attracting more participants, you should assume that the price of most desirable properties will increase at faster rates than before. If you choose to live in some areas like Penang and Kuala Lumpur, you should expect higher prices in the near future. 


Even though most construction companies use lower cost finishing with the aim of maintaining a lower selling price, quality of developments in Malaysia is typically good. Some people moving to the country under MM2H Visa program have experienced many problems associated with the construction companies and legal challenges related to their property purchase. Do not panic yet. You can easily avoid that by relying on the properly established companies in the country. 
Choosing between an apartment and a landed property should be your personal choice. 

Most apartment complexes have a great facility and are more secure. With a landed property, you will have your personal garden and enjoy more privacy. The beach side developments are limited, and mostly, they consist of higher density apartments. If you are planning to build a property, you should engage the services of a property lawyer. Lastly, if you must buy an established property, buy it from a person who has bought off the property plan to avoid problems. You can also consult a real estate agent.











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