Property Ownership Policies and Regulations for Foreigners in Malaysia
- Land and Property Jurisdiction
Under Malaysia’s Federal Constitution all matters relating to land and property fall under the jurisdiction of the respective State Governments and Authorities.
- Variation of Property Ownership Regulations Across States
As such, the property ownership regulations and policies, including the minimum property purchase prices by foreigners may differ from State to State in Malaysia.
- State Minimum Purchase Price vs MM2H Requirements
If the minimum property purchase prices by foreigners imposed by the State Governments differ from the minimum property purchase price stipulations of the MM2H Program, the higher minimum purchase prices will prevail for the MM2H participants.
- Approval for High-Value Property Acquisition
Additionally purchase of properties above RM20 million by foreigner must first obtain approval from the Economic Planning Unit of the Malaysian Government.
- Housing Loan and Financing
Foreigners or MM2H participants may apply to Malaysian banks for house or mortgage financing. Approval will be subject to the applicant’s credit standing and the discretion of processing bank.
Minimum Property Purchase Prices by Foreigners (Selected States & Territory) | |||
| States / Federal Territory | High-Rise Condo (Strata) (RM) | Landed Properties (RM) | MM2H Participants (RM) |
| Perak | 1,000,000 | 2,000,000 | 600,000 |
| Kuala Lumpur | 1,000,000 | – | – |
| Putrajaya | 1,000,000 | – | – |
| Selangor | 2,000,000 | – | – |
| Penang (island) | 1,000,000 | 3,000,000 | 600,000 (500,000) |
| Penang (mainland) | 1,000,000 | 1,000,000 | 600,000 (500,000) |
| Johor | 1,000,000 | 1,000,000 | – |
| Melaka | > 500,000 | > 1,000,000 | 600,000 (High-Rise Condo) |
Property Transaction Costs
1. Stamp Duty (Transfer of Land Deed) :
8.0% of the purchase price
2. Sales and Purchase Agreement’s Legal Fees and Disbursements :
1.0-1.5% of the purchase price
3. Real Property Gains Tax (RPGT) :
RPGT is levied on gains arising from the disposal or sale of real property within a certain time-frame in Malaysia.
The applicable RPGT rates for foreigners and MM2H participants are as follows:
| Within the first 5 years | 30% of the capital gain |
| From the 6th year onwards | 10% of the capital gain |
Important Note :
Both Stamp Duty and Real Property Gains Tax (RPGT) are subject to annual review by Malaysia Annual Budget approved by Parliament every year.
