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News MM2H in News Is Malaysia truly Asia? Expats will not find better
News MM2H in News Is Malaysia truly Asia? Expats will not find better
| Is Malaysia truly Asia? Expats will not find better |
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| Friday, 17 October 2008 17:13 | |||
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Malaysia offers a relaxing ambience, a buoyant and pluralistic culture and some of the best beaches and natural parks in Southeast Asia. Kuala Lumpur, the capital, started out as a tin-mining town in the 1850s and developed as a trading point during the Second World War. The city occupies 244 square kilometres and has a population of 1.8 million. Property prices in Kuala Lumpur rose 7.9 per cent, 5.3 per cent, 6.5 per cent and 6.5 per cent in 2007, 2006, 2005 and 2004 respectively. Despite these increases, prices are still below their pre-Asian crisis level. House prices rose rapidly in the early 1990s with two dramatic surges - of 25 per cent in 1991 and 18 per cent in 1995. After the crisis, prices fell between 1997 and 1999 in Kuala Lumpur. Kuala Lumpur City Centre, Ampang, Bangsar, Brickfields, and Mont Kiara are all expat areas with good price appreciation and demand. A three-bedroom, 1,200-square-foot condo in Mont Kiara sells for Dh560,000 (Dh470 per square foot). A four-bedroom, 2,300-square-foot condo next to City Centre sells for Dh2 million (Dh870 per sq ft). Kuala Lumpur's open real estate laws and low cost of living has seen foreign investors pour into the city in recent years. In a recent UBS report, Kuala Lumpur was No 1 globally when measured on a cost of living index. Prices are also competitive - City Centre prices are about 11 per cent of those in Singapore. Since December 2007, regulations have been substantially removed for those purchasing properties worth 250,000 ringgit ($72,000), and there is no limit on the number of properties that can be acquired. As an Islamic country, Malaysia is attractive to Gulf investors, and Bank Negara, the central bank, has provided regulatory underpinnings for Sharia-compliant investments. Also, Malaysia is popular among UK expats with a large number of Britons having grown up in the country owing to the presence of the UK armed forces there in the 1960s. Importantly, in the 2008 edition of the Global Real Estate Transparency Index by Jones Lang LaSalle, Malaysia was classed as "Transparent", ahead of Russia, Japan and Dubai. Total transaction costs are around 3.4 per cent to 6.75 per cent of the property value, inclusive of commission - among the lowest in Asia. The ringgit peg to the dollar was scrapped in 2005. Malaysia's laws are based on the British legal system, which simplifies the property purchasing process. The rental income of non-residents is taxed at a flat 28 per cent, but there is, incredibly, no capital gains tax. Malaysia also does not impose inheritance or gift tax. The Malaysia My Second Home Programme allows foreigners to stay in Malay-sia for as long as possible on a multiple-entry social visit pass, which is initially for a period of 10 years and is renewable. While participants in the programme cannot work nor do business while staying in Malay-sia, there are duty exemptions and it is open to citizens of all countries recognised by Malaysia. The political and economic forecast for Malaysia is mixed. Inflation hit a 27-year high of 7.7 per cent in June and an expected rise in interest rates will impact property markets. The Economist Intelligence Unit (EIU) forecasts that political uncertainty is likely to grow, as opposition leader Anwar Ebrahim continues his campaign to destabilise the government. The outlook for the market is that prices for high-end condominium in the second half of 2008 are expected to be more cautious and some project launches may be deferred. The completion of new projects is expected to lead to a competitive rental market. The high-end condo market is also driving developers to greater level of product innovation and marketing strategies. Binod Shankar is a Chartered Accountant and CFA Charter holder and has spent several years working at senior levels at several of Dubai's largest property developers, analysing, inter alia, local and global property markets. This article does not constitute investment advice and potential buyers are advised to conduct their own due diligence. By Binod Shankar, Special to Gulf News Published: October 16, 2008, 23:47 Source: Gulf News Add this page to your favorite Social Bookmarking websites
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