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Buying Property In Malaysia As A Foreigner

BY Team Loanstreet

Updated 29 May 2024




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*The content and information on this article might be changed or updated periodically by Team Loanstreet without notice.


Foreigners in Malaysia are either expatriates or tourists and thus have been received with warm welcomes when visiting our country. Now the Government is also encouraging these foreigners to choose to make Malaysia their second home, whether for long-term stay, retirement or investment purposes.
 

If you're reading this and you're a foreigner, before making any decisions, you would need to understand certain policies and legal fees imposed by the Government on property purchases. Therefore, this article serves to guide you through the properties available to foreigners, the minimum purchase value imposed by state authorities, and the property financing in Malaysia.

What's covered in this article?


 

What kind of properties can foreigners own in Malaysia?


Foreign ownership of property is liberal (foreigners can even own 100% of the property) in Malaysia as long as minimum requirements are met. In law, foreigners can own any type of properties except for:
 

  1. Properties valued less than RM1 million
  2. Low and medium cost residential units as defined by state authority
  3. Properties standing on Malay Reserved land
  4. Properties distributed to Bumiputera interest in any property development project as determined by state authority

Having said that, foreigners can easily own a bungalow, terrace house, condominium, flat, landed property, studio unit, commercial property, industrial property, agricultural land (except Malay Reserved Land) and industrial land (except Malay Reserved Land).
 

Read our article “Property Investment Landed or High Rise” to understand more before buying a property.
 

What is the minimum requirement for the property value?


Generally speaking, a minimum value of RM1 mil is applied to all kinds of property in every state. However, state authorities remain in power to amend the minimum value in the states that they control.
 

How can foreigners buy at a lower price?


Malaysia My Second Home (MM2H) programme is a programme tailored to foreigners who wish to stay in Malaysia for a long time (10-year visa). A large number of foreigners who used to work in Malaysia have already applied for this programme for their retirement in Malaysia.


To know the latest requirements and guidelines to apply, read "Malaysia My Second Home (MM2H):  Requirements & Guidelines ".

 

One clear advantage is that MM2H gives foreigners access to the property with a lower value. The table below, taken from iProperty, shows the lowest value of property foreigners can buy with/without MM2H:
 

State The minimum threshold for foreign residential property purchase WITH MM2H
Terengganu, Pahang, WPKL, Putrajaya, Kelantan, Perak, dan Labuan RM1 million RM1 million
Selangor

RM2 million (for Zones 1 & 2)

RM2 million (for Zone 3)

RM2 million (for Zones 1 & 2)

RM1 million (for Zone 3)
Johor

RM2 million (landed property in international zones)

RM1 million (strata title & landed properties within non-international zones, except for Medini)

RM 1 million
Sabah RM1 million (landed title)

RM600,000 (high-rise/strata title)
RM 1 million
Kedah

RM600,000 (Kedah)

RM1 million (Langkawi)

RM 1 million
Perlis RM500,000 RM1 million
Sarawak RM500,000 RM500,000
Penang
(Island)
RM1.8 million (landed)

 RM800,000 (strata title)
RM1 million
Penang
(Mainland)
RM750,000 (landed)

RM400,000 (strata title)
RM1 million
Malacca

RM1 million (landed title)

RM500,000 (strata title)

RM1 million (landed title)

*Zones in Selangor
Zone 1 – Districts of Petaling, Gombak, Hulu Langat, Sepang and Klang
Zone 2 – Districts of Kuala Selangor & Kuala Langat,
Zone 3 – Districts of Hulu Selangor and Sabak Bernam

 

Financing with a home loan in Malaysia


The Margin of Finance (MOF) can go up to 80% for MM2H holders, while non-MM2H holders would generally get 70% MOF. In this matter, foreigners are usually better off taking loans from foreign banks in Malaysia. However, all these come with an exception when they are married to a Malaysian citizen. In this case, the spouse will be required to take part in loan financing to enjoy MOF as high as 90%.


Click the link to find a suitable home loan that meets your requirements in Malaysia.      
 

Will you buy a property in Malaysia
 

As you may wonder, many policies are made to tackle the ballooning property price in major cities. Other than that, Malaysia is still a foreigner-friendly country with relatively cheap living costs. Make sure you are fully prepared with your funds and don't forget to enjoy the interesting life of mingling with the multi-racial community here in Malaysia!


*The above article is intended for informational purposes only. Loanstreet accepts no responsibility for loss that may arise from reliance on information contained in the articles.
 

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About the Author

Team Loanstreet

Run by a professional human-sized team, get resourceful tips & guides from our very own library of financial articles that can help improve your financial lifestyle & make a well-informed money decision. We strive to provide you with the best service in helping you to get the most out of that DUIT!

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