The Malaysian government recently announced a reduction in the minimum price threshold for foreign property buyers in certain areas, lowering it from the previous MYR 1 million to MYR 800,000. This adjustment is being implemented in major cities such as Kuala Lumpur, Johor, and Penang. The initiative aims to attract more foreign investment into the real estate sector while boosting the sales of high-end properties. A key focus of the policy is to address the oversupply of luxury homes, particularly in newly developed apartment zones in Kuala Lumpur and Johor, where the vacancy rate for high-end residences has exceeded 20%.
The government has also introduced a new visa program allowing foreign property buyers to obtain long-term residency permits. This policy has garnered interest from buyers in China, Singapore, and Hong Kong, particularly those seeking options under the Malaysia My Second Home (MM2H) program.Malaysia allows foreign property buyers to obtain long-term residency permits. (Image credit: Pexels)
While interest from foreign buyers is on the rise, the policy changes have sparked some debate. Local residents have mixed opinions. On the one hand, addressing the oversupply of high-end properties is necessary. On the other hand, there are concerns that these changes could drive up overall property prices, exacerbating affordability issues for middle- and low-income families.
A real estate agent in Johor commented, "Foreign buyers are certainly bringing more transactions, but they primarily target the high-end housing market, leaving middle- and low-end properties largely unaffected. However, this segmentation could further widen the price gap in the housing market."