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Campaign For Brits To Invest In Malaysia Property
July 29, 2009Article by Ray Withers
The Malaysian government is putting together a £5 million war chest to attract British residential property investors to the country – especially to buy property in Kuala Lumpur.
A new organisation called Malaysia Property Incorporated has been formed to mastermind the campaign with the objective of luring £3.45 billion of investment over the next decadeThe government sees residential property investment as a growth area as only 2.5% of properties are let, compared with nearer 30% in most other economies.Malaysia formerly zealously guarded property rights from foreigners, but this attitude has changed remarkably recently.
Foreigners are allowed to own freehold residential property, and Malaysia’s is some of the cheapest in the region with prime space going for about £172 per square foot.Despite the recession, Malaysian real estate prices are holding up well in relation to crippling price crashes in other countries – with a 6% drop year-on-year to July 2009, according to Bank Negara Malaysia.
The government also recently liberalised the sector by removing a key approval for foreign transactions except where the transaction exceeds RM40 million and involves a dilution of bumiputra interests.The £5 million fund will be given out in grants over the next five years to MPI ‘to promote and brand Malaysia as a preferred real estate destination to international investors’, with a matching amount from the private sector. MPI’s main target markets include investors in the United Kingdom, West Asia, Japan, Korea, Hong Kong, Singapore and Indonesia.
Typical investments are in Kuala Lumpur property include a range of apartments just a few minutes travelling distance from the business district and city centre.Axis Pandan is two connected developments – the midmarket Axis Residence Deluxe Kuala Lumpur, a 33-storey serviced apartment block including pools, gym and lounge with views over the capital plus Axis Crown Premier, Kuala Lumpur that offers luxury living in a prime location with fantastic views over the city centre and the Royal Selangor golf club.The street levels of the blocks house the region’s largest shopping mall.
All apartments are delivered in a ‘ready-to-let’ offering gross yields of more than 8% and with 60% loan-to-value mortgages. Investments are available for just £19,000 cash plus purchase costs.Prices start at £50,000 for a two-bedroom apartment.Sunway Vivaldi, Mont Kiara is a six-tower development totalling 228 apartments over several acres.
The apartments, due for completion in 2011, will be finished to luxury standards. The investment offers a range of spacious four bedroom apartments, all over 3,400 square feet. Finished to the highest standards, each bedroom has an en suite bathroom.
To sweeten the investment, add to that, a 10% reduction on launch prices, a 75% loan-to-value mortgage and guaranteed yields of 7%, for four bedroom apartments starting at £545,000.