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Malaysia Property Buying Guide for Foreigners in 2025

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Are you an expat looking to call Malaysia home? Check out our detailed investment guide which lays out the foreign ownership process, costs involved as well as the latest information on Malaysia My Second Home (MM2H) and Premium Visa Programme (PVIP).

foreigner-property-malaysia
© swissmediavision | Getty Images

Over the past decade, quite a few expatriates in Malaysia have opted to purchase a residential property either as a second home or for retirement purposes.

A haven for many things, Malaysia is one of the most favoured property markets in Southeast Asia, particularly in the past decade. Recently, the local media reported that Malaysia’s foreign buyers accounted for 10% to 15% of new and second-hand transactions in Malaysia’s largest cities. Many of these properties were residential units purchased as second homes, either for retirement or investment purposes. 

If you are one of those who have been smitten by the idea of putting down roots or expanding your investment portfolio in this country, here are some essential guidelines that can help you navigate your ventures in buying a house in Malaysia.

1. Can foreigners buy a property in Malaysia in 2025?

The National Land Code (NLC) 1965, one of the primary property laws in Malaysia, defines a foreigner as any natural citizen who is not a permanent resident of Malaysia. In principle, foreigners can own any type of property (residential unit – both landed and highrise, commercial property and land, industrial property and land). The NLC also states a similar provision for foreign companies in acquiring property or land in this country.

As Malaysia is governed under a federal system, land matters lie within the state government’s jurisdiction. The rules in the states of Peninsula Malaysia differ from those of Sabah and Sarawak.

Each state has implemented different regulations governing foreign property acquisition i.e. types of property and application procedures. However, there are three types of properties that foreigners are not eligible to purchase:

  1. Properties built on Malay Reserved land
  2. Low and medium-cost residential units as defined by the state authorities
  3. As determined by state authorities, properties distributed to Bumiputera interest in any development project.

Foreigners are also not allowed to purchase agricultural land. Nevertheless, in respect of building land or agricultural land gazetted for development, they may do so after receiving consent from the relevant state authority.

2. How to buy a property under MM2H in 2024

Unlike other countries, Malaysia offers a special avenue for foreigners to purchase homes via Malaysia My Second Home (MM2H) programme.

First introduced in 2002, it has gone through multiple revisions, with latest one being going into effect in June 2024.

The latest MM2H revision is seen as the most significant, with higher financial thresholds and mandatory property investments. They are designed to attract investors rather than retirees. This can also be seen in the lowering of the minimum age limit from 35 to 25 years old.

The revamped MM2H includes a a three-tiered system – silver, gold, and platinum. It is also compulsory to purchase property and hold it for at least 10 years, unless to upgrade to a more expensive property.

Previous requirements such as minimum offshore income and liquid assets have been removed.

The table below summarizes the requirements for MM2H after the revision of June 2024:

 Silver TierGold TierPlatinum Tier
Pass Validity5 years renewable15 years renewable20 years renewable
Minimum Age252525
Minimum Offshore IncomeNoneNoneNone
Liquid Assets RequirementsNoneNoneNone
Fixed DepositUSD150,000USD500,000USD1,000,000
Maximum Fixed Deposit Withdrawal (after 1 year)50%50%50%
Compulsory Property Purchase in MalaysiaMinimum price of RM600,000Minimum price of RM1,000,000Minimum price of RM2,000,000
Participation FeeRM1,000RM3,000RM200,000
Renewal FeeRM1,500RM3,000RM5,000
Length of Stay5 years15 years20 years
Work/Business InvestmentNot allowed to work or invest in business. To apply for relevant passes.Not allowed to work or invest in business. To apply for relevant passes.Allowed to work and invest in businesses.
Permanent Residence (PR) StatusNoneNoneNone
Education and Healthcare BenefitsYesYesYes
Tax Exemption on Funds Brought InYesYesYes
Foreign Domestic HelperNot allowedNot AllowedAllowed
Dependants– Spouse
– Children (biological, step and adopted children) below 21 years of age;
– Children with disabilities (no age limit)
– Children must be aged between 21 to 34, single, and not working in Malaysia
– Parents and/or parents-in-law

Tourism, Arts and Culture Minister Datuk Seri Tiong King Sing in June 2024 has said that MM2H’s new three-tier category will not see changes in the coming years, regardless of the government or ministers.

Explore the latest property launches in Malaysia today!

Can a foreigner buy a property without MM2H?

In September 2022, Malaysia introduced a Premium Visa Programme (PVIP), a long-term residency visa that enables foreign investors and entrepreneurs to live, work or study in this country.

Open to all age categories, the programme provides visa approval for up to 20 years (valid for 5 years and issued at 5-year intervals up to a maximum of 4 times) and foreigners will be able to purchase real estate for residential, commercial or industrial purposes.

There are two main conditions a foreigner must meet to be eligible for PVIP:

1. An offshore income of RM40,000 per month or RM480,000 annually
2. A fixed deposit account of RM1 million with a licensed bank in Malaysia

Source: Immigration Department of Malaysia

All applications are required to be made through an authorised consultant or agency appointed by the Immigration Department of Malaysia. The participation fee for an applicant is RM200,000, while for every dependent is RM100,000. Payment of 10% initial participation fee of RM200,000 must be paid before the PVIP consultant/agency submits the online application. The remaining balance of the participation fee, pass fee, visa fee and security bond will be paid once the online application is approved.

The following documents also needed to be provided to the PVIP consultant/agency that will be uploaded through the online application:

  1. The biodata page of the passport
  2. The Certificate of Good Conduct
  3. Resume, including the latest 3 months’ pay slip
  4. Birth Certificate/legal documents (if accompanied by children)
  5. Marriage/ Divorce Certificate
  6. Letter of verification from Medical Specialist/General Practitioner
  7. Approval from Royal Malaysian Police for security screening

All documents and certificates must be in English or translated into English, certified by the Malaysian Embassy/Consulate.

However, due to poor response towards PVIP, the Malaysian government said they may review the PVIP programme if it did not meet its goals. In early 2024, Ministry of Tourism, Arts and Culture (MOTAC) revealed that only 47 people have signed up for PVIP since its inception in 2022.

SEE WHAT OTHERS ARE READING:
➡️ How to be a Permanent Resident (PR) in Malaysia?
➡️ A foreigner’s guide to renting a property in Malaysia

3. Minimum property price for foreign investment in 2025

Generally speaking, a minimum purchase value of RM1 million is applied to all kinds of property in almost every Malaysian state, except for 3 (refer to the table below). Now, you probably are asking some of these questions, such as what are the property prices in different states? Which cities have the most expensive houses?

foreigner buy house
© 123RF

It is safe to say that the average property price in Perak will not cost as much as in Selangor.

StateState Selling PriceMM2H Selling Price
Johor– RM2 million (landed title in designated international zones)
– RM1 million (high-rise/strata title property within non-international zones, except for Medini)
According to MM2H tier
Melaka– RM1 million (landed title)
– RM500,000 (high-rise strata title)
According to MM2H tier
Negeri Sembilan– RM1 million (landed and landed strata title)
– RM600,000 (high-rise/strata title)
According to MM2H tier
WP Kuala LumpurRM1 million According to MM2H tier
WP PutrajayaRM1 million According to MM2H tier
Selangor – Zone 1 (Districts of Petaling, Gombak, Hulu Langat, Sepang and Klang. RM2 million According to MM2H tier
Selangor Zone 2 (Districts of Kuala Selangor & Kuala Langat)RM2 million According to MM2H tier
Selangor Zone 3 (Districts of Hulu Selangor and Sabak Bernam)RM2 million According to MM2H tier
Kedah– RM600,000RM
– 1 million (Langkawi only)
According to MM2H tier
Penang (island)– RM3,000,000 (landed)
– RM1,000,000 (Condominium)
According to MM2H tier
Penang (mainland)– RM1,000,000 (landed)
– RM500,000 (strata title)
PerakRM1 million According to MM2H tier
PerlisRM500,000 According to MM2H tier
KelantanRM1 million According to MM2H tier
PahangRM1 millionAccording to MM2H tier
TerengganuRM1 million According to MM2H tier
Sabah– RM1 million (landed title)
– RM600,000 (high-rise/strata title)
According to MM2H tier
LabuanRM1 million According to MM2H tier
SarawakRM500,000 According to MM2H tier

NOTES:
1. In the state of Selangor, foreign buyers are prohibited from a) Purchasing landed residential properties unless said property is issued with a landed strata title (e.g. gated community); b) Buying auction properties and c) Purchasing agricultural land.
2. Overhang units are defined as residential units that have received certificates of completion and compliance but remain unsold for more than nine months after being launched.

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4. How to buy a property in Malaysia as a foreigner?

Although the procedure of buying a property varies from agent to agent or from developer to developer, here are the common steps taken when a foreigner decides to buy a property in Malaysia:

Step 1Sign the developer’s sales form or the offer to purchase form with the vendor for sub-sale transactions.
Step 2Apply for financing to purchase the property. (The loan approval process varies from bank to bank, and the approval timeline is subject to the type of property that is purchased e.g. newly launched, under construction, or completed)
Step 3Provide the following documents to the solicitor:-
(i) photocopy of the passport
(ii) correspondence address and contact number(s)
(iii)  income tax number of the Foreign Purchaser and the place of submission of the income tax (applicable for subsale property purchase only)
Step 4From the date of signing the sales form (or offer to purchase), sign the Sales & Purchase Agreement (SPA), deed of the mutual covenant (if applicable) and other transactional documents.

Pay the 10% deposit to the developer/vendor
Step 5Solicitor to apply for state authority consent. Purchaser to provide the following documents to the solicitor:
(i) One (1) certified true copy of the SPA
(ii) One (1) certified true copy of the Foreign Purchaser’s passport
(iii) One (1) certified true copy of the constitution (if the purchaser is a foreign company)
(iv) Latest quit rent and assessment receipt of the property (to be provided by the vendor)
(v) Application form under Section 433B of the NLC
Step 6Pay the balance purchase price by the Third Schedule of Schedule H Housing Development (Control And Licensing) (Amendment) Regulations 2015 (“Schedule H”) or the SPA.
Step 7Under Schedule H, the developer shall deliver vacant possession of the property within 36 months from the date of the SPA (or such later date as may be approved by the relevant authority).

Upon delivery of vacant possession, a certificate of completion and compliance has to be issued and if it is a high-rise property, the strata title has to be applied by the developer. In the case of a sub-sale transaction, the vendor shall deliver vacant possession to the purchaser in accordance with the terms of the SPA.

5. Can a foreigner obtain a mortgage in Malaysia?

According to Bank Negara Malaysia (BNM), under its Frequently Asked Question (FAQ), a non-resident (foreigner) is permitted to borrow in ringgit to finance or refinance activities in the real sector in Malaysia, including the purchase of an immovable property. So yes, foreigners can qualify for home loans in Malaysia. However, access to mortgages in Malaysia very much depends on the individual’s financial standing, the purpose of the purchase and the type of property.

home-loan-malaysia-1024x576
© imran kadir photography | Getty Images

Home financing options

For starters, obtaining a home loan when buying a house through MM2H is indeed a less complex process, as it is a well-established government programme that provides a visa of 5 years. Therefore, banks will be less concerned that you might suddenly move out of the country with an outstanding loan.

If you are not under the MM2H programme, your ability to access a mortgage will vary, depending on whether it is from a local or foreign bank in Malaysia. According to an officer in CIMB bank, unless you are a high net individual (having RM1 million worth of assets), you may need to be a resident in Malaysia for 5 years or more. In addition, you might also require other forms of assets (savings, stocks) in Malaysia that can be used as collateral to obtain a housing loan. Local banks may also have different procedures for houses bought from developers (ranging from newly launched, under construction and completed) and secondary market (subsale).

As for foreign banks, an HSBC mortgage specialist shared that the requirements of a foreign applicant (borrower’s loan eligibility and submission of documents) are quite similar to a Malaysian applicant. However, the margin of finance would also vary between 60% – 80% depending on if the borrower is a non-resident or resident foreigner in Malaysia.

Searching for pre-owned properties? Explore our extensive listings here!

6. How much do you need to buy a house in Malaysia?

Below are a few significant closing costs that you need to include in your property purchase planning:

Stamp Duty

Stamp duty is the tax placed on your property documents during the sale or transfer of the property. The tax includes:

  • stamp duty on the Sale and Purchase Agreements (SPA) of your property – this costs only RM10
  • stamp duty on the instruments of transfer – Memorandum of Transfer (MOT) or Deed of Assignment (DOA). As announced in Budget 2024, for foreigners (non-citizens and foreign-owned companies, excluding Malaysian permanent residents), a flat rate stamp duty of 4% will be imposed on the instrument of transfer of property, effective 1 January 2024.
  • stamp duty on your loan agreement – a flat rate of 0.5% of the total loan. 

Legal Fees (For SPA & Loan Agreement) 2024

On 15th July 2023, the Solicitors Remuneration Order 2023 (SRO 2023) was gazette and implanted. The SRO 2023 governs Malaysia’s legal fees regarding the Sale and Purchase Agreements (SPA) and financing agreements involving immovable properties (land and building) as shown in the table below:

Consideration / Loan ValueSRO 2023
 Scale of fees for SPA and Loan Agreement
First RM500,0001.25% (subject to minimum of RM500)
For the next RM500,000 
For the next RM2,000,000 
For the next RM2,000,000 
For the next RM2,500,000 
For the next RM7,000,0001.00%
Where the consideration / loan sum is in excess of RM7,500,000Subject to negotiation on the excess but shall not exceed 1% of such excess
Discount eligible for SPA / Loan Agreement under the Housing Development (Control & Licensing) Act (‘HDA’) 
 RM500, if consideration / loan is RM50,000 or below
 75% of the applicable fee if consideration / loan is more than RM50,000 but less than RM250,000
 70% of the applicable fee if consideration / loan is more than RM250,000 but less than RM500,000
 65% of the applicable fee if consideration / loan is more than RM500,000 but less than RM1,000,000
 50% of the applicable fee if consideration / loan is more than RM1,000,000

Real Property Gains Tax (RPGT)

This may not be a purchasing cost, but foreign buyers should take note that Real Property Gains Tax (RPGT) will be charged on the profit gleaned from a property disposal (in the future). Should foreigners sell a property within the first five years of owning it, they would be liable to pay RPGT at 30% of the chargeable gain, whereas if they sell off the property in the sixth year onwards, they will only have to pay 10% RPGT.

CHECK OUT: What is Real Property Gains Tax (RPGT) in Malaysia & How to calculate it?

7. Can a non-Malaysian inherit a property in Malaysia?

The short answer is yes. Based on the law, if there is a will, the executor will need to apply for probate (a legal process to carry out the remaining wishes of a dead person’s will) that is required to distribute the property. If a written will is absent, the beneficiaries will need to apply for a Letter of Administration (LAD). Both processes are to be submitted to the High Court of Malaysia.

Similarly, the NLC under Section 433B (1)(e) also states that a foreigner can own and inherit property in Malaysia only after he has obtained approval from the state government. Make sure to read Property inheritance in Malaysia: Related laws and applications for letters of administration

8. Is buying a property in Malaysia a good investment?

With everything that is currently happening in Malaysia, both on the economic and political front, you are probably thinking, why even bother right? And with more digital investment options coming into play (cryptocurrency, NFTs, metaverse real estate), buying a property, especially for investment, may seem unnecessary.

Nevertheless, investing in a property is still one of the best investment vehicles to deliver capital gains in the long run and the Malaysian residential market remains appealing to buyers from across Asia, particularly China and Japan.

A recent property survey, conducted with nearly 350 real estate agents nationwide, further affirms that more than two-thirds of the respondents expect offshore buying of Malaysian property to return to pre-COVID-19 levels within 18 months – that is, by the end of 2023.

Malaysia has also been a preferred choice for many expatriates who plans to migrate or settle down with their families. Many areas within Klang Valley have been in constant demand, especially properties in the vicinity of reputable international schools. Make sure to go through top neighbourhoods with international and private schools in Klang Valley.

As foreigners are allowed to invest and own properties in Malaysia, the purchased property can be easily leased out or sold in the event the homeowner or investor decides to leave Malaysia. Moreover, demand for properties in the vicinity of such schools has been moving up in tandem.

However, if Malaysian property is disposed of with capital gains, it will be subjected to capital gains tax or real property gains tax.

Disclaimer: The information is provided for general information only. iProperty.com Malaysia Sdn Bhd makes no representations or warranties in relation to the information, including but not limited to any representation or warranty as to the fitness for any particular purpose of the information to the fullest extent permitted by law. While every effort has been made to ensure that the information provided in this article is accurate, reliable, and complete as of the time of writing, the information provided in this article should not be relied upon to make any financial, investment, real estate or legal decisions. Additionally, the information should not substitute advice from a trained professional who can take into account your personal facts and circumstances, and we accept no liability if you use the information to form decisions.

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Frequently Asked Questions About Foreigners Buying Property in Malaysia

Generally you can within specific price ranges, but you are not allowed by law to buy properties in Malay Reserve Land, low and medium cost residential unit and agricultural land.
A minimum purchase value of RM1 million is applied to all kinds of property in almost every Malaysian state, except for Zone 1 and 2 in Selangor and Sarawak.
For foreigners holding permanent residence status, the tax rate ranges from 0% to 25%, contingent on the applicable tax bracket.
Foreign individuals typically have the freedom to lease out their properties in Malaysia, although certain limitations might be imposed by state or local authorities, particularly for certain property categories. To ensure conformity with applicable laws and regulations, it's recommended to seek legal counsel.