UK Investor Guide to Malaysia
Thinking of Buying Property in Malaysia? A Practical Guide for UK Investors
As property prices climb across the UK and Europe, savvy investors are increasingly looking further afield for high-yield, affordable alternatives. One country making waves is Malaysia—offering a rare combination of freehold ownership, relatively low entry costs, and solid rental returns, all within a legally structured, English-speaking environment.
Whether you're after passive income, a retirement base, or Southeast Asian residency, here’s what UK investors need to know about buying property in Malaysia.
Why Malaysia?
Malaysia stands out in Southeast Asia for its unique investor appeal. Property prices are considerably lower than in Singapore or Hong Kong, yet the quality of life and infrastructure is high. Entry prices for modern, well-located condos start from around RM600,000 (approximately £100,000)—a fraction of London’s cost for similar amenities.
Foreigners can buy freehold condominiums, enjoy zero tax on offshore income, and benefit from a relatively transparent legal system with English-language contracts. Add in a warm climate, excellent healthcare, and a large English-speaking population, and Malaysia starts to look like a very comfortable second-home base.
Spotlight: Johor Bahru
For many UK investors, Johor Bahru, just across the causeway from Singapore, is one of Malaysia’s most compelling markets. The city is undergoing rapid transformation, driven by cross-border infrastructure like the RTS Link (a high-speed train connecting Johor to Singapore, launching end-2025) and the Johor–Singapore Special Economic Zone (SEZ), which is attracting international companies and expats.
One standout project in the area is R&F Princess Cove, a high-rise waterfront development with sea views, full facilities, and walking access to the upcoming RTS.
Can Foreigners Buy Property in Malaysia?
Yes and with full ownership rights. Foreign buyers can purchase:
Freehold or leasehold strata-title properties, such as condominiums or serviced apartments.
Properties must be priced above the foreign buyer threshold, which is RM600,000 (Approx £100,000) in most states, including Johor and Kuala Lumpur.
Foreigners cannot usually buy landed houses unless special exemptions apply, and land ownership comes with added restrictions.
What Are the Costs Involved?
While prices are appealing, there are a few important costs to keep in mind:
Stamp Duty (MOT): 4% of the property price, due upon signing.
Legal Fees: Often absorbed by the developer for new builds.
Maintenance & Sinking Fund: Around RM0.40 per square foot per month, depending on the development.
Property Taxes: Very low; annual costs for assessment and quit rent are negligible.
Developments like R&F Princess Cove typically include many buyer incentives, with legal costs, foreign levies, and furnishings sometimes included.
Can You Get a Loan?
In practice, most UK investors buy Malaysian property in cash. While mortgages are technically available, they usually require:
Local income proof (from Malaysia or Singapore)
Larger down payments (often 30–50%)
Slower and stricter approval processes
That said, Malaysian prices are low enough that many buyers don’t need financing at all.
Rental Income & Yield Potential
Rental income depends heavily on location and strategy. In Johor:
1-bedroom units typically rent to single professionals or expats commuting to Singapore.
2-bedrooms offer the best rental flexibility and yield for short- and long-term leases.
Gross rental yields range from 4% to 6%, particularly if Airbnb or serviced rental models are used.
Short-term rentals are legal in most areas and popular in Johor, where proximity to the CIQ and RTS makes short stays attractive to commuters and weekenders.
What About Resale?
This is where many foreign investors need to manage expectations. Resale markets in Malaysia, especially for high-rise condos, can be slower-moving than in Western markets.
R&F Princess Cove, for example, is popular with foreign buyers, but less so with local Malaysians who often prefer landed homes. Your best strategy here is to hold for 5–10 years, generate rental income, and sell once key infrastructure like the RTS is operational and fully priced in.
Residency: The MM2H Visa Advantage
Malaysia offers a unique incentive for long-term investors: the Malaysia My Second Home (MM2H) visa. This program grants long-term residency to foreigners who:
Are over 30 years old
Meet basic income and fixed deposit requirements
Own property in Malaysia worth at least RM600,000 (Approx £100,000) (in Johor)
Johor’s version of MM2H is more accessible than West Malaysia’s national program, with lower financial thresholds and a 10-year renewable stay.
Final Word
Buying property in Malaysia is not a speculative play, but rather a strategic investment. With careful planning, UK investors can enjoy:
Strong rental returns
Potential for long-term capital growth
A lifestyle upgrade
Residency options via MM2H
If you’re eyeing Southeast Asia and want to get in before the RTS and SEZ lift prices further, Johor and particularly developments like R&F Princess Cove, is worth serious consideration.
Thinking about investing in Asia?
Contact our expert team for a free consultation.
Email: info@alestriaproperty.co.uk