Buying Property in Malaysia

Buying property in Malaysia is easier than in many other nations. Yet it is important for a foreigner to know of the fee structure, official process and documentation needed to complete the purchase.

The minimum value of the property that a non resident Malaysian can purchase is MYR 250,000. Property value less than this amount can be sold only to a native. Also, foreigners can purchase a maximum of two properties. In case they wish to purchase more than two, they have to get a special approval from the Foreign Investment Committee of the Economic Planning Unit at the Prime Minister’s Department. Also once purchased, a foreign buyer cannot sell the property within three years from the purchase date.

It is advised that when a property is selected for purchase, the buyer should get a structural survey done. This prevents any structure related problems from arising later. Once satisfied; a deal can be struck with the seller by signing a contract of purchase. This contract has a 3 month validity during which the buyer can verify all the documentation offered by the seller. Also, it is during this period that the proof of ability to pay or a payment plan has to be rolled out.

An important clause of the purchase contract is that the buyer has to make a minimum payment of 10% of the property value which is not refundable. Hence if the buyer backs out, he/she has to forfeit this amount. Also, in case the seller is not able to close the deal after the contract stage, he/she has to pay the buyer 10% of the property value for defunct sale.

If all goes smoothly, the process is closed with the signing of the sale and purchase agreement during which the remaining amount has to be paid. Henceforth, the purchase agreement is forwarded to the land registry with an application to get the title deeds transferred to the name of the new owner. The extra costs involve the stamp duty, lawyer’s fee, estate agent’s fee etc.