More foreign buyers could reduce unsold units. Attract the right ones.

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Many months back, someone asked me if foreigners were the cause for property price increase? I told him that the Malaysian property market is nowhere near the advanced property markets where foreign purchase is concerned. In some advanced markets, the foreign buyers may account for over 15 percent, maybe even as high as 25 percent. In Malaysia, the percentage is likely to be very small. So, property price increase, if any must be due to the locals. This is especially for properties below RM600,000 for which foreigners are not allowed to buy. There are minimum price requirements for foreigners who wish to buy properties in Malaysia.

Article in malaymail.com The Malaysian chapter of the International Real Estate Federation (FIABCI) president Michael Geh said that the government could encourage more foreign buyers of properties to resolve issue of unsold units in the country. He said, “Three per cent is still relatively low so we can increase foreign owners of Malaysian properties to five per cent.” He said this is not to invite foreign speculators but is aimed at foreign buyers who are keen to reside, work or let their children study in Malaysia.

He further elaborated, “There are a lot of genuine foreign buyers, especially Malaysia My Second Home applicants, who are here to stay. We can give MM2H applicants more points to ease their applications when they purchase properties here to encourage them to invest into our properties and live here.” He added that these MM2H applicants, who are mostly retirees, are from developed countries such as US, Europe, Japan, Australia, Hong Kong and China with higher spending power. Due to their higher spending power, this will help bring about economic development.

A Property Market Report 2018 by the Valuation and Property Services Department (JPPH) revealed that there was a residential overhang of 32,313 units valued at RM19.86 billion in 2018. Article in malaymail.com

I have to say that based on the numbers, which is just 3 percent, its pretty safe to have some campaigns to attract these foreigners who would like to treat Malaysia as their second home. Usually, when they have stayed here for a while, I think Malaysia may be the place they will spend most of their time in. Come here to be an ENJOYEE, not a retiree. Earlier article here) Perhaps the campaign could be a time-based one and make it a targeted one too. I am very sure Malaysia is a favourite destination of many foreigners judging by the many awards we have won over the years. Best place to retire vs most liveable Happy attracting many of our foreign friends to think about property Malaysia.

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