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Malaysia: Investment Potential 2008

Investing in property in Malaysia is a relatively new phenomenon as the market was only opened up to overseas property investors in 2006. Since then it has begun attracting high levels of investor interest thanks to the country's strong economy, booming tourism and positive government initiatives to encourage foreign investment. With widespread use of English and similar legal and financial systems, property investment in Malaysia is a tempting prospect.

Great Investment Climate

Property investors who have been watching the Malaysian property market have seen strong economic growth, which stood at 7.3% in 2007. Both the economy and the housing market have been boosted by strong consumer spending because of low interest rates and low unemployment. In addition, the government's programme ‘Malaysia My Second Home' (MM2H), aimed at foreign retirees, has increased demand for second homes and retirement properties. The programme has so far attracted almost 10,000 participants from the UK.

Malaysia Tourism Records

Malaysia has always been a perennially popular travel destination, but the last few years have seen record rises in tourist figures. Prospective property investors in Malaysia will be encouraged by a massive increase of 19.5% in tourist arrivals between 2006 and 2007, when figures reached a record 20.97 million.

High Rental Yields in Kuala Lumpur

Another encouraging sign for property investors in Malaysia is the country's growing significance as a centre for world trade, with low business costs attracting investment from multinational companies. This is good news for the executive property market, particularly in Kuala Lumpur city centre where rental yields are between 7.4% and 8.7%, with off-plan properties giving even higher yields of up to 10%. There is a large expatriate population in Malaysia as well as a young and prosperous Malaysian workforce. Both are fuelling demand in the capital and pushing rents up to the level of other major international business centres, which is very good news for property investors in Malaysia.