MIPEAC: Property Overhang Can Be Reduced by Improving MM2H Programme
The Malaysian Institute of Professional Estate Agents and Consultants (MIPEAC) says more foreigners should be encouraged to take up Malaysia My Second Home (MM2H) programme and to invest in Malaysian properties as this could help ease the current glut in the property sector.
In a statement released yesterday, MIPEAC asserted that it would be a waste not to strengthen the promotion of MM2H and encourage more foreign investments in the country’s property sector.
MIPEAC President Francis Loh said with RM20 billion worth of residential overhang, we should be more open to foreign buyers with high spending power to enter the market.
“In general, efforts to drive in foreign investments in other segments like commercial and industrial properties should be taken more seriously as well. MIPEAC believes that more can be done to encourage foreign buyers and investors to enter Malaysia’s property market."
“High-end developments can be marketed more intensively globally, together with the on-going efforts done on the tourism sector,” said Loh.
He added that although stricter background checks for MM2H applications have been implemented recently, MIPEAC applauds the Tourism, Arts and Culture Ministry’s efforts to speed up the approval process of the backlogged applications by setting up a special task force.
“Concurrently, growth in the ICT sector in Malaysia will also pull in more professional foreign workers which will, in turn, translate into more property purchases by expatriates.
"Initiatives are taken by some developers which include organising tour groups with visits to their sales gallery as part of the package also deserve credit, as it will not only help to clear their stock but also put Malaysia in the limelight as an ideal property investment location with direct help from experienced sales agents,” he said.
He noted that foreign homebuyers, especially under MM2H, are mostly genuine buyers who are keen to reside, work and let their children study in Malaysia.
“We should not think of this as an invitation to allow more thick-pocketed speculators into the market, but as a good solution to improve our economy. It has been reported that Chinese nationals make up most of the foreign buyers in Malaysia, and many of them purchase these properties in cash."
“To date, foreigners own less than 3% of Malaysian real estate which indicates that it is still safe to promote our unsold homes to them and that it is not the main factor for the high property prices we’ve seen in the past few years,” Loh noted.
According to Loh, MM2H applicants are mostly retirees from more developed countries such as US, Europe, Japan and China.
"Malaysia’s great transportation network, world-class facilities, lower living cost and all-year-round summer vibe, it’s no surprise that Malaysia is regarded as one of the best countries in Asia for retirement."
“Malaysia is also the only Asean country listed in The World's Cheapest, Safest Retirement Countries report released by Investopedia.com. Thus, the government and related parties should work hand-in-hand and see this as an opportunity to lower the overhang and bring the heat back to the high-end property market that has been experiencing a slowdown in recent years,” he concluded.