Buying Property in Malaysia as a Foreigner: Rules, Minimum Prices and Costs

Foreigners can buy property in Malaysia in their own names, whether for a home, a retirement base or an investment. However, the properties you can buy depend on the state, with different minimum prices and restrictions for condominiums, landed homes and commercial premises.

Before you start shortlisting properties, it helps to understand which options are open to you.

In this article, we will walk you through the ownership rules, minimum prices in the main markets, and the costs and steps involved in buying property in Malaysia.

Can Foreigners Buy Property in Malaysia?

Yes. Foreign individuals can own eligible property without setting up a Malaysian company. However, approval depends on the property’s location, value, title and permitted use.

In Peninsular Malaysia, these acquisitions are governed by section 433B of the National Land Code, which requires prior State Authority approval for transactions covered by the provision. Section 433C makes dealings that contravene this requirement void.

Sabah and Sarawak follow separate land laws, so purchases there must be assessed under their respective ownership and approval requirements.

Alongside the approval requirement, foreign buyers face restrictions on:

• Low-cost and low-medium-cost housing designated under state policy.
• Property on Malay reserve land.
• Units allocated to Bumiputera purchasers, unless an applicable release or approval permits the transaction.
• Property below the applicable foreign-buyer minimum.
• Property types excluded by the relevant state.

Keep in mind that meeting the minimum price does not guarantee approval. A property can exceed the threshold and still be unavailable because of its title, allocation or category.

Minimum Property Prices for Foreigners in Malaysia

The minimum price can change substantially between locations. A condominium and a landed home in the same state may also have different thresholds.

The table below compares published residential thresholds in Malaysia’s main property markets. Separate conditions can apply under special schemes and project-specific approvals.

Selangor’s Zones 1 and 2 cover Petaling, Gombak, Hulu Langat, Sepang, Klang, Kuala Selangor and Kuala Langat. Zone 3 covers Hulu Selangor and Sabak Bernam.

Penang’s RM500,000 mainland strata threshold applies to foreign individuals. Its land office guideline lists a separate RM1 million mainland strata threshold for foreign companies.

These figures come from published state guidance and the Malaysian Bar’s October 2024 compilation. Before signing, have your lawyer confirm the current threshold and valuation basis for the specific unit, including any later policy changes or special approvals.

For purchases outside these markets, obtain the relevant state requirements before choosing a property. Rules can distinguish between districts, title categories, developer stock and resale properties.

Can Foreigners Buy Landed Property in Malaysia?

Foreigners can buy eligible landed property in several states, but the restrictions are often tighter than for condominiums.

For example, Selangor permits qualifying strata and landed-strata purchases rather than landed homes on individual titles. Johor excludes single-storey and one-and-a-half-storey terraced houses under its published foreign-acquisition restrictions.

Because eligibility can depend on the title, check how the development is legally structured before paying a deposit. A gated development does not automatically have strata titles, and the unit may carry additional restrictions or purchaser allocations.

Can Foreigners Buy Commercial Property in Malaysia?

Foreigners can buy certain commercial properties, but eligibility depends on both the premises and the purchasing entity. Some states restrict acquisitions to Malaysian-incorporated companies, while others exclude commercial purchases under their foreign-acquisition policies.

The Malaysian Bar’s October 2024 reference table lists commercial purchases in Kuala Lumpur, Putrajaya, Labuan and Sabah as restricted to Malaysian-incorporated companies within its foreign-purchaser framework. It lists commercial acquisitions in Pahang, Terengganu and Sarawak as not permitted. Confirm the current state position before structuring a purchase around these reference rules.

Other states restrict particular commercial categories. Penang, for example, excludes low-cost shops, stalls and service workshops, while its guideline provides acquisition routes for premises such as private hospitals, private schools and hotels.

Where a company purchase is permitted, its ownership structure still needs to be checked against the foreign-interest rules. The premises must also be approved for the business activity you intend to carry out.

Stamp Duty and Other Property Buying Costs

Once you have confirmed that a property is eligible, calculate the full acquisition cost. In addition to the price, you will need to budget for transfer stamp duty, state approval charges, legal fees and any financing costs.

Residential stamp duty for foreign buyers

From 1 January 2026, residential property transfers to non-citizens who are not Malaysian permanent residents, and to foreign companies covered by the Stamp Act provision, attract 8% stamp duty.

The duty is calculated on the higher of the consideration or market value. The statutory residential definition includes houses, condominiums, apartments, flats, serviced apartments and SOHO units used solely as dwellings.

Malaysian permanent residents are excluded from this foreign-individual rate. The standard progressive transfer-duty scale is:

For a residential property with a purchase price and assessed market value of RM1.2 million, the comparison is:

If the assessed market value exceeds the purchase price, the duty increases accordingly. Commercial and industrial acquisitions require a separate calculation.

Electronic stamping and self-assessment

Your lawyer handles stamping through LHDN’s e-Stamp Duty system via MyTax. However, the move to electronic submission is separate from the phased introduction of self-assessment:

State approval fees and levies

In addition to federal stamp duty, the state can charge an application fee and an approval levy. Johor and Penang illustrate how these charges differ.

In Johor, Circular 3/2025 sets a residential acquisition approval fee of 3%, subject to a minimum of RM30,000. For developer purchases, the calculation uses the agreement value. For residential subsales, it uses the higher of JPPH valuation and agreement value, subject to the minimum fee. A separate RM2,000 application fee per title also applies.

The circular includes a minimum RM50,000 approval fee for certain developer sales of serviced apartments below RM1 million, subject to state approval. This provision does not create an automatic entitlement to purchase below the normal threshold.

Penang’s August 2024 guideline sets a 3% levy for landed property, including landed-strata property. A 1.5% rate applies to qualifying island strata acquisitions valued between RM1 million and RM1.5 million; other strata categories listed in the guideline attract 3%.

Penang also charges application fees according to the purchaser and property category. Obtain a current fee calculation before signing, particularly where a concession or special scheme is involved.

Legal fees and loan stamp duty

Request an itemised legal quotation covering the sale and purchase agreement, transfer, consent application, searches and disbursements. Financing documents involve separate legal work and charges.

Loan agreement stamp duty is charged at the standard rate of 0.5% of the loan amount, subject to any applicable exemption or relief. A RM700,000 loan would attract RM3,500 in loan stamp duty, separate from the duty on the property transfer.

Ongoing ownership costs

Once you own the property, ongoing costs can include land tax or parcel rent, local authority assessment tax, insurance and repairs. Strata owners also pay maintenance charges and sinking fund contributions.

For an investment property, include these expenses alongside financing costs when calculating the expected rental return.

Tax on rental income

If you rent out the property, Malaysian income-tax obligations also form part of your ownership costs. The treatment depends on your tax residence, ownership structure and allowable expenses.

Foreign citizenship does not by itself determine income-tax residence, so include rental-income reporting and tax compliance when planning the investment.

Buying Property Under the MM2H Programme

If you are buying a home as part of a move to Malaysia, consider the residence route alongside the purchase. Property ownership does not grant residence permission, while the MM2H program requires qualifying participants to buy a home after approval.

The federal program’s Silver, Gold and Platinum tiers have the following financial and property requirements:

Applicants for these three tiers must be at least 25. After purchasing the required property, participants cannot sell it during the first ten years except through the permitted upgrade arrangement, which allows a move to a higher-value residence.

However, the programme minimum does not automatically override state acquisition rules. Confirm the state’s treatment of your category and the purchase deadline in your approval conditions before selecting a property.

Separate arrangements apply to the SEZ/SFZ category and state programs such as Sarawak MM2H. Emerhub’s MM2H program article explains the residence options in more detail.

How to Buy Property in Malaysia as a Foreigner

Once you have shortlisted an eligible property, the purchase moves through legal checks, financing, the sale agreement and the required approvals. Developer purchases and sub-sales differ in their payment arrangements, so establish the correct process before committing funds.

1. Confirm the property’s eligibility

Appoint a lawyer to check the title, ownership, encumbrances, restrictions in interest and foreign-purchaser requirements. Confirm the applicable minimum value and whether the property is a restricted unit or category.

For a commercial purchase, check that the intended business activity is compatible with the premises’ approved use. For an MM2H purchase, check both programme conditions and state rules.

2. Check financing and the total budget

Malaysian banks offer financing to eligible foreign buyers, but approval and lending margins depend on the bank, income profile, property and supporting documents.

Obtain a preliminary financing assessment before committing to contractual payment deadlines. Your budget should also cover transfer duty, state charges, legal costs and any amount the bank will not finance.

3. Review the purchase terms before paying

Developer and subsale purchases follow different arrangements. For housing transactions governed by the relevant Housing Development Regulations, developers cannot collect booking fees or other payments before the sale and purchase agreement is signed.

For a subsale, have your lawyer review any offer, earnest deposit and stakeholder arrangement. Establish what happens to the deposit if state consent is refused or another agreed condition is not met.

4. Sign the sale and purchase agreement

The agreement sets the price, payment schedule, approval conditions and completion obligations. State-consent requirements should be reflected in the contract, including the consequences of refusal or delay.

Where prescribed developer agreements apply, payments follow the relevant contractual schedule. Subsale terms require separate review, including deposits, extensions and termination provisions.

5. Apply for the required approvals

Your lawyer submits the state approval application with the required purchaser, property and transaction documents. Additional approvals may apply according to the title, property category or transaction structure.

Processing times vary by state. The agreement should allow for the approval process and establish when the completion period begins.

6. Complete payment, stamping and the transfer

After the required conditions are satisfied, your lawyer coordinates completion, the applicable stamping procedure and registration of the transfer.

Where an individual or strata title has not been issued, the transaction may initially proceed through an assignment. Your lawyer should explain how ownership will be documented and how the transfer will be completed once the title becomes available.

Selling Property in Malaysia as a Foreigner

When you sell, the tax treatment depends on who owns the property and how long it has been held. You must also check any resale restriction imposed by the state or your MM2H conditions.

Real property gains tax

Real property gains tax is charged on the taxable gain from a disposal, rather than the full selling price. For an individual who is neither a Malaysian citizen nor a permanent resident, the rates are:

A Malaysian-incorporated company falls into a different RPGT category, even if it is foreign-owned. Company disposals therefore require a separate calculation.

The taxable gain takes account of the acquisition price and allowable costs. Our article on calculating real property gains tax explains the calculation in more detail.

Retention, remittance and filing

To collect tax toward the seller’s liability, the buyer has a retention and remittance obligation. For a seller in the relevant foreign-owner RPGT category, the standard retention rate is 7%.

For disposals from the 2026 year of assessment, the buyer can use an alternative remittance based on the seller’s notified deemed-assessment amount where LHDN’s conditions are met. The buyer’s remittance is due within 60 days of the statutory disposal date and is credited against the seller’s tax liability.

Both parties must also meet their RPGT filing obligations. Have your lawyer or tax adviser establish the statutory disposal date, particularly where the agreement requires government approval.

Buying Property in Malaysia with Emerhub

Emerhub supports foreign investors establishing a presence in Malaysia. Our team can help you with:

• Assessing long-term residence options, including MM2H.
• Setting up a Malaysian company where a corporate purchase forms part of your business plans.
• Coordinating company and immigration requirements with the advisers handling your purchase.

Contact our Malaysia team to discuss your property plans alongside your residence or business requirements.