Malaysia mulls over raising minimum property prices for foreigners

Houses at Nusa Idaman estate in South Johor’s Iskandar Malaysia project, which is being touted as a high-class resort area. Singaporeans form a large group of owners of holiday homes in Iskandar Malaysia.
Houses at Nusa Idaman estate in South Johor’s Iskandar Malaysia project, which is being touted as a high-class resort area. Singaporeans form a large group of owners of holiday homes in Iskandar Malaysia. ST PHOTO: DESMOND LIM

SIMPANG PERTANG - The Malaysian government might raise the minimum purchase price for properties bought by foreigners due to the weakening ringgit, a Cabinet minister said on Monday (March 13).

Housing Minister Noh Omar said that revising the floor price would give Malaysians wider availability to buy a property.

The poor exchange rate of the ringgit against foreign currencies has also enticed higher interest from foreigners, he was quoted as saying by the New Straits Times(NST) after attending an event in Negeri Sembilan.

Foreigners today, generally, can only buy Malaysian property valued at RM1 million (S$318,000) and above.

This minimum price, set by the federal government, has been revised several times in the last two decades, with state governments allowed to set their own minimum prices.

Tan Sri Noh, who is the Urban Wellbeing, Housing and Local Government minister said that the government had conducted a study on the issue and is considering two options.

One would be to raise the floor price of RM1 million per property.

The other is to set the minimum price in US dollars for all foreign buyers, NST reported him as saying.

The minister spoke about the property market after he was asked to comment on a report that the Penang state government plans to allow foreigners to buy property in the state at a minimum price of RM800,000.

The Penang government, ruled by federal opposition parties including the Democratic Action Party, reasoned that even lowering the floor price by RM200,000 would affect few prospective Malaysian buyers.

Housing and industrial units in Johor, such as in the Iskandar Malaysia region, Penang, Malacca and Kuala Lumpur are often sought by buyers from Singapore.