The Malaysian government is keen to draw more foreign property investors particularly from Singapore, UK and India.
According to Malaysia’s Foreign Investment Committee, a comprehensive deregulation of investment guidelines has been designed to assist overseas buyers.
“The most important aspect in purchasing Malaysian real estate is the land law system that allows for transparency and enforceability of ownership. Foreigners also have no impediment to buying freehold Malaysian real estate and to sell when the need arises without restriction,” said Kumar Tharmalingam, a member of the board of governors at Malaysia Property Incorporated.
To date, investors from Korea, Singapore, India, and the UK have been the biggest buyers in the country, spending about $150,000 to $300,000, with Penang, Kuala Lumpur and Johor being the most popular locations.
This year, the property sector will benefit from an improving economic outlook and an increasing demand, according to the Malaysian Industrial Development Finance’s latest research note.
However, it cautioned that despite the improving economic sentiments and the encouraging sales demand, the uncertainty of demand sustainability, absence of favourable regulations and attractive promotions, and the withdrawal of cheap credit may take its toll on the property sector.
“Sales demand for residential properties is expected to remain buoyant as investors continue to deem it as one of the more liquid hedging assets. Speculators are also taking advantage of the current market sentiment to lock-in on gains,” stated the report.
A survey of major property players showed that none was holding back new launches or slowing down their pace of project development, with many taking advantage of the present discounted valuations to replenish land banks.