Property Malaysia

Most of you would have some time or other heard about the ‘Malaysia My Second Home‘ (MM2H) programme touted by some of the sales and marketing folk. For a background of it, you can check out one of our earlier postings on it here. It was formerly known as the Silver Hair Programme from 1996 to 2002. The programme was mainly targeted at attracting retirees from other countries to settle in Malaysia as their second or holiday home.

But while the developers are almost always promoting it to all those foreigners (especially ‘mat sallehs’) that walk in the sales office, a lot of people have chipped in with comments and feedback to make the programme more effective and attractive.

It is to everyone’s advantage that such a programme like the MM2H be successful. Malaysia is a stable country politically and economically, and the comparative low property prices always make it more attractive as compared to, say, Singapore or Hon Kong. In addition to that, with the foreign exchange being brought into the country, other sectors such as banking, retail, tourism and service sectors stand to gain a lot from the expatriates.

According to a recent report, the programme has change quite a bit since its launch. Besides the name change, it has been moved from the Home Affairs Ministry to the Tourism Ministry (which we feel makes better sense). According to a recent report, this as resulted in an increase in the number of participants, from 2002 to 2005, a total of 6,695 participants were approved under the programme. Its Deputy Minister, Datuk Donald Lim said that there will an official relaunch of the MM2H some time this month. Some of the changes are include approval of multiple entry visa for 10 years (previously 5years) and setting up a ‘one-stop agency’ of sorts will be set up to approve the applications within 1 to 3 months.

Furthermore, the ministry will be targeting foreigners from countries in East Asia (Japan, South Korea, Hong Kong, China), Middle East and of course, Europe. They expect to approve 2,000 to 3,000 applicants per year, although no specific target has been set.
At the moment Chinese nationals followed by Bangladeshis are the highest number of participations.

The following is the highlights of new rules for MM2H under the Ministry of Tourism, effective April 2006:

Aged below 50:
Open a fixed deposit (FD) account of RM300,000 and after one year, the participant can withdraw up to RM240,000 for approved expenses relating to house purchase, education for children in Malaysia and medical purposes. Must maintain a minimum of RM60,000 from the second year onwards and throughout stay in Malaysia under the programme.

Aged 50 and above, Can choose to :
Open a FD account of RM150,000
OR
show proof of monthly offshore income of RM10,000 from approved/recognised institution in their country of origin, such as a pension scheme.
Participants who fulfil the FD criteria can withdraw up to RM90,000 for approved expenses relating to house purchase, education for children in Malaysia and medical purposes after one year. Must maintain a minimum balance of RM60,0000 from the second year onwards throughout stay in Malaysia under the programme.

House purchase
Each participant is allowed to purchase up to two units of residential houses at a minimum price of RM150,000 to RM350,000 and above each, depending on the location of the property. Generally, the minimum price for the purchase of houses in Malaysia is set at:

• RM350,000 and above each for certain areas in Sarawak;
• RM250,000 and above each for Penang, Melaka and Johor; and
• RM150,000 and above for other states.