Many years ago when I was still based in Penang, someone asked me if foreigners were one reason why property prices were rising much faster than salary growth. I told him, statistically nope. The percentage of foreign buyers was just too low to make any meaningful impact. Even if we were to include every MM2H applicants who bought a home here in Malaysia after they have moved here. Latest number as per an article I read put the number at just a paltry 3 percent. In many of those popular cities, the number is likely to be a double digit figure and the number may not even start at 1. That’s called ‘high’.
Article in themalaysianreserve.com Asiacap Valuer & Property Consultants Sdn Bhd property valuer Kit Au Yong said that the influx of Hong Kong buyers will not be able to absorb enough supply to move the market, unless the purchases surge like when the mainland Chinese came to acquire the units in Forest City, Johor. In addition, he shared that there is the floor price of RM1 million for Hong Kong buyers and this is the segment in need of them today.
VPC Alliance (KL) Sdn Bhd MD James Wong also agreed that buyers from the Pearl of the Orient will not hike Malaysian house prices. He said, “There is a huge glut of homes in the country, and Hong Kongers are purchasing only a small fraction of this glut. It will not affect the overall oversupply situation in the residential market. They are also discerning buyers who have many friends, relatives and business associates in Malaysia, so they will check and compare the prices before buying.”
Juwai.com executive chairman Georg Chmiel said official Hong Kong government data shows that the number of locals seeking police checks has surged by 48%. He said, “These ‘good citizenship’ documents certifying that they do not have a criminal record are crucial to enable them to apply for the Malaysia My Second Home Programme (MM2H) and other foreign visas. Applications increased 12% in June, 41% in July and 48% in the first two weeks of August.” This may be evidence that many Hong Kongers are seeking to move to Malaysia for work or education. Please do refer to the full article here Article in themalaysianreserve.com
Yes, I think our property market remains very safe for some extra few foreign purchases. Just need to ensure they are buying because they are also looking to stay here occasionally. Truth is, when people have money, they will need to spend it. Nothing wrong to give them a good place where they could also spend their money and helping businesses too.
What we do not want is for the foreigners to buy blocks by blocks even if they could pay. For those, it will mean trouble in the future. Prices they could afford and prices which the locals could afford are different and they own SO MANY units that locals will find it hard to buy something they could afford. Thats a NO NO yeah. Else, I certainly welcome a higher interest of foreign buyers with the Malaysian property market. Happy understanding.
Next suggested article: People do not buy because of incentives. They buy when they understand.