Malaysia is an incredible place to live and invest in. From mouth-watering food to stunning cityscapes and breathtaking beaches, there’s something for everyone. If you're a foreigner considering buying property here, the process can be straightforward or complex, depending on your background.
Fortunately, Malaysia’s property market is well-regulated, ensuring security for buyers and investors.
While Malaysia is welcoming to foreign buyers, purchasing property comes with legal and financial considerations. Here’s everything you need to know about buying property as a foreigner in Malaysia.
Can Foreigners Buy Property in Malaysia?
Yes, foreigners can purchase property in Malaysia, but the process depends on the state where you intend to buy. Malaysia allows foreign ownership for both residential and investment purposes, subject to certain restrictions.
Under the National Land Code 1965, a foreigner is defined as any individual who is not a permanent resident of Malaysia. Companies with significant foreign ownership also fall under specific regulations.
Each state in Malaysia has the authority to impose its own conditions and fees on foreign property purchases. This means that while purchasing property is possible, additional transaction fees may apply.
What Properties Can Foreigners Buy?
Foreigners are generally allowed to buy most property types, but there are restrictions on certain categories:
Malay Reserved Land – Land designated exclusively for Malay citizens.
Low-cost and medium-cost affordable housing – Designed for local buyers only.
Bumiputera-reserved units – Properties allocated to Malaysia’s indigenous groups.
Despite these restrictions, foreigners can purchase a wide range of properties, including luxury condominiums, townhouses, and high-end landed properties.
Malaysia follows a federal system, meaning property regulations vary by state. This includes different pricing thresholds and legal requirements, which we will cover next.
Buying Property Under Malaysia My Second Home (MM2H)
Malaysia’s MM2H program offers foreigners a long-term visa with property ownership benefits. MM2H holders can apply for property financing and, in some states, purchase homes at lower price thresholds.
Each region (Peninsular Malaysia, Sabah, and Sarawak) has its own eligibility criteria, often requiring proof of financial stability through offshore income or bank deposits.
MM2H Benefits for Property Buyers:
Longer stay and investment opportunities.
Potential discounts on certain property purchases.
Higher loan margins (up to 80% financing).
Minimum Property Purchase Price for Foreigners (2024)
Different states impose minimum purchase prices for foreign buyers. Here’s a quick reference guide for residential properties:
State | Minimum Price | MM2H Price |
Kuala Lumpur, Putrajaya & Labuan | RM1 million | RM1 million |
Selangor | RM2 million | RM2 million |
Penang | RM2 million (Zone 1 & 2) / RM1 million (Zone 3) | RM1 million |
Johor | RM1 million | RM1 million |
Melaka | RM1 million | RM1 million |
Negeri Sembilan | RM1 million | RM1 million |
Kedah | RM1 million (Langkawi: RM600,000) | RM1 million |
Sabah | RM1 million | RM1 million |
Sarawak | RM600,000 (Kuching) / RM500,000 (Other areas) | RM600,000 / RM500,000 |
Some states, like Penang, Johor, and Melaka, also impose additional foreign buyer levies (2-3% of the purchase price).
Understanding Local Property Terms
Strata Titles – Common for apartments and condominiums with shared amenities.
Landed Property – Houses with individual ownership (e.g., bungalows, semi-detached homes).
Overhang Properties – Unsold units where supply exceeds demand.
How to Buy Property in Malaysia as a Foreigner
Step 1: Find Your Ideal Property
Explore available properties in Malaysia and choose one that meets your criteria.
Step 2: Submit a Letter of Offer
This includes a deposit (usually 2-3%) to confirm your intent to purchase.
Step 3: Apply for Financing (if needed)
MM2H holders: Up to 80% loan financing.
Non-MM2H buyers: Maximum 70% financing.
Foreign bank financing is also an option.
Step 4: Provide Legal Documents
Submit the required documents to your lawyer, including:
Passport copy
Proof of income/tax details
Company details (if applicable)
Step 5: Sign the Sale & Purchase Agreement (SPA)
A 10% deposit (including the earlier 2-3%) is required upon signing.
Step 6: Obtain State Authority Consent
Your lawyer will handle this process, submitting relevant documents for approval.
Step 7: Settle Remaining Payment
Pay the remaining 90% balance as per the SPA terms.
Step 8: Receive Property Ownership
For new developments, vacant possession occurs within 24 months (landed) or 36 months (strata title). For resale properties, transfer timing depends on the SPA terms.
Stamp Duty & Legal Fees (2024)
Stamp Duty for Foreign Buyers
A 4% stamp duty applies to all property transactions by non-citizens (excluding permanent residents).
Legal Fees (SPA & Loan Agreements)
Property Price | Legal Fee % |
First RM500,000 | 1.25% (Min RM500) |
Next RM7,000,000 | 1% |
Excess of RM7,500,000 | Negotiable (Max 1%) |
Can Singaporeans Buy Property in Malaysia?
Yes! However, Singaporeans with Housing & Development Board (HDB) flats must fulfill a five-year minimum occupation period before purchasing overseas property, including in Malaysia.
Conclusion
Malaysia offers an attractive and secure environment for foreign property buyers, whether for residence or investment. Understanding the rules, eligibility, and financial aspects ensures a smooth purchase process. With favorable policies like MM2H and a vibrant property market, now is a great time to consider investing in Malaysian real estate!