MULTIMILLION-RINGGIT luxury homes in Malaysia are seemingly attracting Chinese nationals, with investment and education opportunities driving their interest.
According to a report by Singapore’s Straits Times, several real estate firms said that 2024 so far has seen more people from China looking to buy homes in Malaysia, especially in Kuala Lumpur’s prime areas such as the central business district and leafy suburbs, including Bukit Damansara, Bangsar and Kenny Hills.
They said Malaysia’s relative political stability and anticipated stronger economic growth compared with a year ago have made it an attractive destination for wealthy Chinese, especially with other countries clamping down on education and business avenues for foreigners.
Luxury residential property usually refers to units priced at RM1 million and above.
This is nearly twice the average price of a new apartment, which now stands at RM582,887, according to data released by global proptech firm Juwai IQI in its Malaysian residential sales market report for the first quarter of 2024.
According to Juwai IQI CEO Kashif Ansari, every year, they receive thousands of inquiries from potential foreign buyers.
“And in the first quarter of 2024, the number of inquiries from Chinese buyers rose by 42% from the preceding quarter.
“The 42% increase in inquiries by Chinese buyers resulted in a similar increase in buyers purchasing homes.
“They made up the largest segment of foreign buyers in Malaysia, who are generally looking to buy either landed or high-rise apartments, mainly in Kuala Lumpur and Johor, of up to RM2 million,” Kashif was quoted as saying by the Straits Times.
It was reported in 2023 that a growing number of Chinese investors were offloading their overseas properties due to higher mortgage payments driven by rising global interest rates and the slowdown in China’s economy.
In June, the Malaysian government revamped the Malaysia My Second Home residency visa scheme, which made it compulsory for foreign residents to buy property in the country.
Malaysia has become the second most popular Southeast Asian destination for Chinese real estate buyers, up from third place in 2022, said Juwai IQI in early 2024. Thailand is in the top spot.
In general, Malaysia allows foreigners to buy property only in the upper tiers of the real estate market priced at RM1 million and above, to ensure that locals are not priced out of the market.
Overall, the number of Chinese nationals residing in Malaysia has grown due to more of them studying or working in the country.
According to the Education Ministry, Malaysia’s higher education institutions had 44,043 Chinese students in 2023, a 35% increase from 2021.
“Students will be the significant driver of housing demand in Malaysia because many families find it more convenient to purchase a home,” noted Kashif.
In a recent Financial Times report, a Chinese trade official was quoted as saying that the number of Chinese executives and employees working at Chinese companies in Malaysia has quadrupled over the past three years – from 10,000 in 2021 to about 45,000 currently.
And since the implementation of visa-free travel arrangements between China and Malaysia in December 2023, more Chinese tourists have flocked to the country. In the first five months of 2024, 1.1 million Chinese visited Malaysia, against 1.4 million visitors in the whole of 2023. – August 13, 2024.
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