CHAPTER TWENTY: Property Investing in Malaysia

Malaysia is spread across the South China Sea, occupying a peninsula bordering Thailand and a third of the Island of Borneo. The area is one of the most beautiful corners of the world, famous for palm fringed white beaches, gentle seas and rainforest. To this cultural and geographical vibrancy Malaysia adds flourishing financial and high-tech industries based in Kuala Lumpur. Popularly known as KL, Malaysia’s capital has a modern cityscape which compares with any financial centre in the region. With annual population growth of 1.8% Kuala Lumpur is growing fast. Seven out of every one hundred people in the capital are ex-pats, a testament to the economic strength of the city.

The investment opportunities in KL mean that most property buyers look here first, often beginning in the prestigious ‘KLCC,’ the popular acronym for Kuala Lumpur City Centre. Otherwise, investment opportunities also exist in Malacca, Penang and Langkawi. Prices are highest in Kuala Lumpur, but rental yields generally sit at around 8% in most locations.

Is This a Good Place to Buy?

Overseas investment in the property market concentrates on Kuala Lumpur with a secondary market in the resorts and islands. These areas are popular with people retiring to Malaysia under the Malaysia, My Second Home programme.

Local consultants CH Williams Talbot and Wong say that the market is ‘highly energised’. Forecasts for 2005 and 2006 are optimistic, as the past year has seen completion of a number of sophisticated projects, but demand continues to significantly outstrip supply.

The international…