Chinese interest in Malaysian property increased five-fold this year
Chinese interest in Malaysian property increased five-fold this year
But why now?
Chinese buyer enquiries for properties in Malaysia soared 550 percent in the year to August 2016, while views of Malaysian properties listed online flew 52.7 percent, Juwai.com reported.
“For Chinese buyers, Malaysia is a nearby, easily accessible country with an appealing and very affordable housing market,” Charles Pittar, chief exectuive officer of Juwai.com, explained to OPP.Today. “Money invested there is perceived to be at greater risk than it would be in a larger economy like the US or Australia. Malaysia tends to attract buyers pursuing investment or lifestyle strategies, who have other family or commercial ties to the country or who simply cannot afford to purchase in a market like the US or Australia.”
Real estate players in Malaysia are well aware of such interest and making a concerted effort to attract buyers from China. “They are locating and designing projects to appeal to Chinese as well as locals, and they are marketing them in China,” Pittar reported.
More: 10 reasons why you should invest in Iskandar Malaysia
While speculation motivates the Chinese to buy property in Malaysia, the reverse is true in neighbouring Singapore, Juwai.com data showed. Investment drove 54 percent of Chinese buyers to acquire Malaysian properties, while education drove 59 percent to snap up Singaporean properties. Only 15 percent of Chinese buyers in Malaysia are driven by education, while 23 percent of buyers in Singapore are driven by investment.
“Unlike, say the UK, Malaysia does not attract many buyers motivated by education,” Pittar said.
The Chinese are shifting serious cash in Malaysia. The average value of Malaysian property searches by the Chinese hover at USD224,000. “China was the biggest source of inward investment to Malaysia last year across the board, not just in property,” Pittar said. “Some of the investment in industry and development has positive spill-over effects for residential property.”
Even so, Chinese buyers make up only a significant minority in the Malaysian real estate marketplace. Malaysia ranks 11th worlwide on Juwai.com for Chinese buyer interest.
Read next: Inside Malaysia’s efforts to weather a lethargic property market
Source: Property Report