Find out about the steps involved when buying a house or apartment in Malaysia...
As of 1 January 2010, the minimum price of a property to be purchased in Malaysia must be over RM 500,000 (USD 155,000). This minimum threshold is determined by local government and may therefore differ between states.
Foreigners are not permitted to buy property in Malay reserve land or Bumiputra reserved units.
Buying property in Malaysia can take much longer than in many Western countries. If the intended property purchase is not a new property, the process can take four to six months. It is advisable for foreigners to avoid leasehold properties (which generally trade at a discount compared to freehold properties), as the process can take up to one year, and state government consent is required.
Renting out a property
Rental properties are subject to tax. A non-resident buyer who rents out their property is subject to a flat rate tax of 28 percent on the rental income.
Property Purchase Process
As buying a property involves a range of legal matters and several different parties, it is advisable to engage a lawyer and an estate agent, especially if the buyer is unable to be present.
Foreign buyers must obtain the consent of the state government before a property is transferred from the seller to the foreign owner, which can take from six weeks to six months, depending on the state. Once consent has been given, buyers who do not live in Malaysia can sign the Sales and Purchase Agreement at the Malaysian High Commission in their country of residence.
Financing is available to eligible buyers from most Malaysian commercial banks and foreign banks located in Malaysia. Loans range from about 70 to 80 percent of the purchase price, depending on the buyer's credit history and the value of the property.
Real Property Gain Tax (RPGT) applies to any property sold within five years of its purchase.
Fees involved in buying a property
- Government stamp duties
- Legal fees
- Loan agreement fee
- Estate agent's fee
- Valuation fee
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