REAL estate agents are offering prospective foreign buyers online property tours after Covid-19 put an end to open borders and are also completing deals across thousands of kilometres digitally.

In Southeast Asia, Malaysia is one of the more attractive countries for high-end property investors and expats, with Kuala Lumpur being the centre of luxury living and services.

Coupled with Malaysia My Second Home (MM2H), many foreigners have purchased residential properties in Penang and Johor Baru.

Star City Global marketing director Florence Ten said foreign buyers are taken on live-streaming tours showcasing the environment and surroundings, while legal documents can be sent online to seal deals as well.

Ten herself completed 10 deals during the movement-control order period, adding that prospective buyers are comfortable viewing the properties and buying them online if there’s trust between the buyer and the seller.

“The pandemic really hurt the property sector. Before Covid-19, our primary focus was on those from Hong Kong, and there was an average of about 20 people a month coming to view properties, with the smallest group consisting of two people and the biggest, six.

“We forecast that sales to foreign buyers would be better in 2020 as the viewership increased in 2019 but because of the pandemic, people can’t view the properties in person and the market has cooled.

“Our company completed RM1.1 billion in transactions in 2018, which increased to RM3 billion in 2019. We thought the trend would continue into 2020.”

Ten also told The Malaysian Insight that MM2H contributed to its performance and the freeze is affecting sales.

“Without MM2H’s foreign buyers, we can only look for foreigners who are interested in buying on their own. Before this, those under MM2H are moving to Malaysia due to their children’s studies and the properties they buy are usually near universities.

“For example, those who have children studying in Putrajaya’s international schools will purchase property there. Mt Kiara in Kuala Lumpur also has international schools and is another place foreigners like to choose,” she said.

Ten also said about 60% of buyers under MM2H stay at the properties they buy, while the remaining 40% are investors.

Some foreign celebrities have also recommended buying properties in Malaysia, potentially resulting in the spike of Hong Kong folk applying for MM2H, she said.

Tourism, Arts and Culture Minister Nancy Shukri earlier said MM2H has been temporarily suspended pending a review of its plans until year-end.

MM2H consultant Patrick Ho said many foreign buyers who made the initial payments are now backing out and asking for refunds following the suspension.

“Foreigners are only allowed to buy properties more than RM1 million here, but after the suspension and rejection of applications from September last year to June this year, we have customers complaining that they cannot apply for a visa and have since abandoned their plans to buy homes in Malaysia,” Ho said.

Ten said she is facing similar issues but she is now attempting to convince foreigners of the merits of investing in Malaysian properties even without MM2H.

“After our explanation, they understand that even though there is no MM2H, investing in Malaysian property can get them good returns, so they proceed with their purchase,” she said.

A spokesman for a major property developer told The Malaysian Insight that its projects in Kuala Lumpur, Penang and Johor Baru are well received and are attracting high net worth foreign investors.

“We have at least 10 units that are in the process of being sold and we have told these buyers that their purchases are not the same as MM2H. The suspension of the plan is affecting the real estate industry because, for example, the British like to come here to escape the heat while the Chinese come here to escape the winter.

“And actually, even though 70% of MM2H applicants end up not buying homes, the remaining 30% do. Foreigners like Malaysia because of our healthcare standards and environment,” he added. – August 24, 2020.