With lush landscapes, a diverse multi-ethnic culture and a relaxed foreign ownership policy, Malaysia remains an attractive choice for holiday home buyers
Sabah’s location on Borneo may give it an aura of remoteness, but for Andrew Baines the East Malaysian state is the centre of his family’s world for a few months a year.
The Englishman, who lives and works in Singapore and has previously resided in the Malaysian cities of Kuala Lumpur and Johor Bahru, fell in love with Sabah on a visit there some years ago and in 2013 purchased a unit at The Peak condominium in Kota Kinabalu, the state capital, for MYR530,000 (USD146,000).
He has recently added to his property portfolio in Sabah, purchasing a unit in the new PacifiCity development, which – on its completion – will be the largest integrated residential, commercial, retail and entertainment hub in Sabah with a total of 11 components.
Taking the leap into purchasing a second home in a foreign country is no small matter for even those with the deepest of pockets. Baines, however, could not be happier with his investment.
“Kota Kinabalu is well on its way towards offering all the conveniences of a modern city lifestyle,” he says. “Although it presently lacks the variety of entertainment, retail and leisure options you can find in KL, Penang and Singapore, we can see these materialising very quickly with developments such as Imago and PacifiCity (new shopping malls).
“Life here is very pleasant. The mood and ambience is friendly, crime is very low and we feel very safe here. There are no major traffic jams, but best of all there is no haze or air pollution.”
Baines’s experience in Sabah is one that is mirrored by many other foreign investors at holiday locations around the country, such as Penang and Langkawi. Nevertheless, despite having abundant buzzing cities, lush emerald landscapes and paradise beaches; Malaysia in many ways remains one of Southeast Asia’s most underrated destinations for investment in real estate.
While rich buyers from oversaturated markets such as Singapore and Hong Kong look to frontier destinations in the region including Vietnam, Indonesia and the Philippines for bargain prices and generous yields, Malaysia’s relative stolidity often counts against it.
Despite low land prices (typical prices for land in Sabah, for example, are less than USD3 per square foot, comparable with markets such as Vietnam), and relatively loose restrictions on foreign-ownership, investment in Malaysia is surprisingly sluggish – with foreign buyers making up only about 4 to 7 percent of the market.
Nevertheless, those who decide to take the plunge are finding that investing in a second home in Malaysia carries a host of benefits ranging from lifestyle advantages to attractive prices and steady growth. A recent international survey on affordable living ranked Malaysia third in the world. Other marketable factors, meanwhile, include the country’s relatively low cost of living, widespread use of English in commerce and communication as well as the availability of quality education and healthcare.
Another draw for foreign investors is the Malaysia My Second Home (MM2H) scheme, an international residency initiative enacted by the Malaysian Government to allow foreigners to live in the country on a long-stay visa of up to 10 years.
“I’ve been around and I still firmly believe Malaysia is the best country in the world”
Critics of the scheme have pointed out that a significant proportion of foreigners who visit Malaysia are entitled to a three-month visa on arrival arrangement, which can easily be renewed by exiting and re-entering the country making the lengthy and costly MM2H approval process seem unnecessary for many. Nevertheless, these foreigner-friendly moves are indicative of Malaysia’s willingness to market itself openly as a second-home destination.
“I’ve been around and I still firmly believe Malaysia is the best country in the world,” comments Christopher Boyd of CBRE Malaysia. “What’s more, it is even more accessible due to long-term residence options to attract expats.”
Even better established as an investment destination than Sabah is Penang, which is one of the undoubted stars of northern Malaysia.
Great transport and air links from the mainland and also from nearby Asian countries such as Singapore and Thailand make the so-called “Pearl of the Orient” even more appealing for prospective property owners. It is no surprise then that the real estate market on the island continues to entice buyers, with a clutch of new projects
the eye.
Of course, North Malaysia is far from just a one-island show, and developers are doing good work in other holiday destinations such as Perak. The Haven Lakeside Residences in Ipoh, the capital of Perak, has become a favourite of investors looking for a green holiday home. Conceived by developers The Haven Sdn Bhd, the project incorporates a host of energy-saving initiatives such as solar panels and building design that maximises the cooling effect of natural breeze. Also proving a hit in Ipoh are properties at the gated Lakeside Mansions at Sunway Ipoh City, one of top Malaysian developer Sunway’s integrated city projects.
“As one of the most iconic tourism destinations amongst all states in Malaysia, Perak presents a blend of old world architecture charm, modern lifestyle and ecotourism,” noted a recent report from property consultancy C H Williams Talhar and Wong. “These attractions will play a major role in the tourism sector as they draw in local and foreign visitors.”
Still, it is undoubtedly Penang that is attracting the most interest from. While the island’s historic capital, Georgetown, is one of the most evocative cities in the region, much of the development is centred on the north, home of the idyllic beach enclave of Batu Ferringhi.
Among the popular projects in this area is Quayside Resort, a gated community located at the tip of the island fronting the Andaman Sea. And it was this glorious location, as well as Penang’s multi-ethnic cultural backdrop, its amazing street food and the prestigious reputation of developer Eastern & Oriental (E&O) that tempted Canadian national Philip Ngai to invest in a unit there.
“My wife and I lived in Singapore but Penang had been a frequent destination for vacations during the past decade,” he says. “There are many things that appeal to us about Penang beyond its obvious physical and cultural attributes. It is less densely populated than Hong Kong and Singapore and other major centres in Malaysia such as Kuala Lumpur and it has a substantial health-care infrastructure with a large selection of medical specialist facilities, which are highly affordable. What’s more Penang properties are also much more reasonably priced for high end development.”
In addition to the Quayside Resort, E&O have developed an impressive range of projects on Penang with a view to attracting second-home investors. These include Seri Tanjung Pinang, an ambitious master-planned development with an array of residential and leisure components on the coast between Batu Ferringhi and Georgetown.
“It (Seri Tanjung Pinang) presented a unique opportunity,” comments Christina Lau, head of marketing and sales for Penang at E&O. “Because our product offering was on par with international standards, coupled with Penang’s attractiveness, we soon saw the entry of foreign buyers, some of whom came in under the MM2H programme. We have a sizeable number of international buyers comprising over 20 nationalities including Singapore, Japan, the UK, China and Indonesia.”
Despite Malaysia’s undoubted appeal, few would argue that the outlook is completely rosy for its property market. Growth has been tentative in recent years and some have voiced concern that supply may be outstripping demand. Nevertheless, with top-class and relatively affordable real estate augmented by compelling lifestyle attributes, the country remains a fundamentally sound choice for second-home buyers.
SABAH
Fast facts:
Sabah is home to Southeast Asia’s highest mountain, the towering Mount Kinabalu
Kota Kinabalu airport is one of the best connected in Malaysia and is the country’s second largest after Kuala Lumpur
Not far offshore from Kota Kinabalu is Tunku Abdul Rahman Marine Park, a wonderland of coral reefs and white-sand beaches.
Pacific City, Kota Kinabalu by Pacific Sanctuary Holdings Sdn Bhd
Price: From MYR800,933 (USD221,105)
Unit size: From 1,060 sqft
Completion date: 2017
Key features: Unparalleled views over the South China Sea and convenient access to the airport and the amenities of Kota Kinabalu
The Republic by Elica Sdn Bhd
Price: MYR1.92m (USD529176.78)
Unit size: From 3,417 sqft
Key features: First development in Borneo to have a private wine cellar
PENANG
Fast facts:
Penang is the only state in Malaysia where the ethnic Chinese are the majority
It is known for being Malaysia’s premier food paradise. Its hawker food has been voted the best in the world on numerous occasions and signature dishes include Assam Laksa, a spicy noodle soup with poached mackerel, and Char Kway Teow, flat rice noodles with prawns, cockles and beansprouts fried in pork lard.
Penang’s premier beach destination is Batu Feringghi, but other sandy enclaves include Pantai Teluk Kampi and Jerejak Island.
Ferringhi Residence by Mah Sing Group
Price: From MYR870,000 (USD241,378)
Unit size: From 1,510 sqft
Completion date: Completed
Key feature: Top floors enjoy ‘safari roofs’ with semi-open roof decks
18 East at Andaman by Eastern & Oriental Bhd
Price: From MYR1.56m (USD432,817)
Unit size: From 877 sqft
Completion date: 2017
Key features: World-class clubhouse, 4.5acre waterpark and 6.9 acres of lush greenery
IPOH
Fast facts:
Ipoh has one of Malaysia’s lowest crime rates
Once known as the “City of Millionaires” due to its lucrative tin mining industry.
Ipoh is the preferred gateway to natural attractions such as the Cameron Highlands, a cool hill station, and Pulau Pangkor, a laid-back island retreat.
Haven Lakeside Residences by The Haven Sdn Bhd
Price: From MYR650,500 (USD202,364)
Unit size: From 1,400 sqft
Completion date: November 2013
Key features: Use of solar panels and also positioning and design of buildings to maximise positive effect of elements for energy-saving purposes
Lakeside Mansions by Sunway City (Ipoh) Sdn Bhd
Price: From MYR2.5m (USD703,973)
Unit size: From 7,775 sqft
Completion date: 2015
Key features: Scenic views of ancient limestone hills and 10-acre private lake. Limited to 16 exclusive units with five different layout designs.
(Source: http://www.property-report.com/malaysias-ultimate-second-home-spots/)
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