How it works: Malaysia’s new and improved second-home visa
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Where do you look to find a home away from home? For many Singaporeans, their answer lies just across the border in neighbouring Malaysia. In 2023, they accounted for 13.2 per cent of Malaysia’s property purchase enquiries, making Malaysia the third-most popular destination for Singaporean buyers.
Of course, they are not the only ones. Malaysia remains a hotspot for investors from China and as far as the United Kingdom. To fuel more activity in the real estate scene, the Malaysian government launched the Malaysia My Second Home (MM2H) programme in 2002, a renewable long-term visa scheme allowing foreigners to live in Malaysia for an extended period of time.
After a brief suspension in 2020 during the pandemic and a poorly-received revival in 2021 due to overly strict conditions, the latest revamp of the scheme on December 15, 2023 sees a renewed effort to attract a wider pool of applicants to stimulate the property sector.
What’s new?
The biggest change to the MM2H programme is that it now boasts three tiers – silver, gold and platinum – each with different eligibility criteria. Silver, its lowest-tier category, has lowered the fixed deposit amount from RM1 million (US$215,053) to RM500,000(US$107,526).
The minimum age across all three tiers has also been lowered from 35 to 30 years old, while the list of eligible dependents has been extended beyond spouses, children aged below 21 and children with disabilities to include children between 21 and 34 years old who are not working in Malaysia or married, as well as parents and parents-in-law.
Applicants can withdraw a maximum of 50 per cent of their deposits one year after their applications have been approved to be used for either purchasing property, healthcare spending or their children’s education in the country, adding a “practical benefit”, according to Winston Lee, Director (Special Projects) at PropertyGuru.
Collectively, these conditions will widen the scope of foreigners who qualify for the scheme. “This flexibility could boost the Malaysian property market as it provides an incentive for foreign residents to invest in local real estate, contributing to the overall growth of the sector,” Lee added.
What’s missing?
One thing to note, however, is that the full list of renewed requirements has yet to be released. In particular, potential buyers are keeping an eye out for updates on the required minimum income and gross assets.
In the previous iteration in 2021, the former criterion presented the biggest obstacle to interested parties. Its high threshold of at least a RM40,000 (US$8,662)monthly income priced out many middle-income applicants and retirees, leaving only the extra-wealthy in the pool. The result was a 90 per cent drop in applicants since 2021.
So what?
While this sense of uncertainty has led people to hold back on their applications for now, there is reason to be optimistic, if the relaxation of requirements that have been revealed so far are any indication.
These changes – and the ones to come – are not set in stone either, which can spell good news. Minister of Tourism, Arts and Culture Tiong King Sing has announced that the revamped MM2H scheme would be run as a one-year trial, and can be updated along the way based on evolving expectations and demand.
“In essence, the revamped MM2H programme is positioned to attract a diverse range of individuals seeking an attractive and comfortable second home in Malaysia while positively impacting the local property market,” Lee said.
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