MOVING TO MALAYSIA? LOOKING FOR THE RIGHT AREAS FOR YOU AND FAMILY? HOW TO ENSURE YOU HAVE MADE THE RIGHT INVESTMENT CHOICE?
Real Estate Agency & Property Marketing
JLJ covers local and international real estate agency practice including leasing and sales of all types of properties such as land, commercial properties, industrial properties, residential properties and projects launching by developers.
Estate agency practice means acting as an agent for a commission / fee in respect of the sale or acquisition of properties or leasing or letting of properties. Estate agency practice is handled by Registered Estate Agents assisted by Negotiators.
Buying properting in Malaysia, step-by-step guide :
Eligible Properties
Direct ownership is permitted and foreigners are eligible to purchase unlimited number of freehold or leasehold (99 years) properties of any type, except below :
- Properties valued below RM1,000,000 (wef 1 May 2014)[1]
- Land or properties with “Malay Reserved” status
- Agriculture land, unless purchase is over 5 acres and for commercial purposes
- Properties assigned under the Bumiputra quota (Malays and indigenous tribes)
Some projects under construction, are required to pre-assign certain percentage of units for bumiputra, a special purchase privilege for the Malays and indigenous tribes in Malaysia
Transparent and well regulated Malaysian land laws and administration systems, adopted based on Torrens System.
[1] Foreigners are permitted to purchase properties valued above RM1,000,000 in Kuala Lumpur; above RM2,000,000 and non landed for Selangor State.
WHAT OTHER EXPENSES INCURRED BEFORE AND AFTER OWNING A PROPERTY IN MALAYSIA?
- PROPERTY ACQUISITION COSTS
- PROPERTY MAINTENANCE COSTS
- REAL PROPERTY GAIN TAX (RPGT)
- INHERITANCE TAX
Property Acquisition Costs
Acquisition costs is very low in Malaysia, only slightly less than 2.5% of property value.
- Legal Fees
- Legal fees on SPA and loan documentations are calculated based on the standard scale fee given in the table below. The disbursement fees is an additional of approx RM2,000 and RM2,500 respectively
| Value of property / loan amount | Rate |
| 1st RM150,000 | 1.00% |
| Next RM850,000 | 0.70% |
| Next RM2,000,000 | 0.60% |
| Next RM2,000,000 | 0.50% |
| Next RM2,000,000 | 0.40% |
| Over RM7,500,000 (negotiable) | >0.40% |
- Stamp duty on Loan Agreement is approximately 0.5% of loan amount (RM5 per RM1,000)
- Stamp Duty on Title (payable upon issuance of title)
- Scale rate calculated based on Purchase Price
| Value | Rate |
| 1st RM100,000 | 1.00% |
| RM100,001 to RM500,000 | 2.00% |
| RM500,001 and above | 3.00% |
Property Maintenance Costs
Calculated base on share value of the unit. Managed by the Management Corporation/ JMB
| Type | Description | Payable to | |
| 1. Maintenance / Management / Service charges / Other Fees | Service Charge | Pay monthly. Calculated base on share value of the unit. |
|
| Sinking Fund | |||
| Master Fire Insurance | Pay once a year. | Management Corporation/ JMB | |
| Sewerage Charge | Pay twice a year. | Service Provider (INDAH WATER) | |
| Household Insurance | Pay once a year. | Service Provider (insurance company) | |
| 2. Property Tax | Assessment Tax (Cukai Pintu)
(levied by local government) |
Pay on half yearly basis. Assessment on the annual rental value of the property is performed by the local authorities / councils.
Approx RM2,000 to RM3,000 every half yearly. |
Local Council |
| Quit Rent (Cukai Tanah) levied by the state government | Pay once a year.Calculated base on share value of the unit.
Approx RM50 to RM200 per year. |
Management Corporation/ JMB | |
| 3. Other Taxes | Income Tax (if property purchased is used for rental income) | Assessed on net rental income (less deductible expenses such as maintenance charges, assessment, bank interests, estate agency fees etc) at a prescribed tax rate. | Local Council |
Note ~ Estimation based on apartment size at 2,500 sq ft located in the city centre, maintenance fee at RM0.50 psf per month
Real Property Gains Tax
With effect from 1 January 2014, there is a 5% Property Gains Tax if property is disposed after 5 years of ownership (from date of SPA), applicable for FOREIGNER and COMPANIES purchase.
| Disposal Period | RPGT Rates | ||
|---|---|---|---|
| Individuals (Citizen / PR) |
Companies | Individuals (Non-Citizen) |
|
| For disposal within first 3 years | 30% | 30% | 30% |
| For disposal in the 4th year | 20% | 20% | 30% |
| For disposal in the 5th year | 15% | 15% | 30% |
| For disposal in the 6th year and subsequent years | 0% | 5% | 5% |
Inheritance Tax
Property will be distributed in accordance to buyers will.