China overtakes Singapore as biggest investor in Malaysia property
Mainland groups invest $2.1bn over three years as they seek alternatives to Australia and HK
China has eclipsed Singapore as the biggest source of investment in Malaysian real estate as soaring domestic property prices push mainland investors to hunt for bargains abroad.
Malaysia has emerged as a favoured destination for mainland Chinese investors seeking a cheaper alternative to Australia and Hong Kong.
Singapore has traditionally been one of the biggest outbound real estate investors in Asia and the biggest foreign investor in neighbouring Malaysia. However, China has stepped up its investment at a time when warmer political ties between Beijing and Kuala Lumpur have eased commercial relations.
Malaysia, which is home to a large ethnic Chinese diaspora dating back generations, has attracted a wave of Chinese expatriates drawn by the promise of unpolluted skies, a low cost of living and proximity to Singapore’s shopping and nightlife.
“The Chinese investor today has a lot more options and has become more comfortable going to Europe and the US, but not everyone has the same options — Malaysia is much more affordable,” said Sigrid Zialcita, managing director of Asia-Pacific research at Cushman & Wakefield.
“If you compare prices, even between Malaysia and China, you are looking at a significant difference,” she added. Property prices in top-tier Chinese cities such as Beijing, Shanghai and Shenzhen have soared during the past year and are some of the most expensive in the world.
The close economic ties between Malaysia and China were underlined this week when Alibaba announced it would set up a regional logistics hub near Kuala Lumpur airport, part of a digital free-trade zone launched by Malaysian prime minister Najib Razak and Alibaba founder Jack Ma.
Some 8,000 Chinese citizens have been granted the right to live indefinitely in Malaysia under a foreign residency programme launched in 2002 and targeted at pensioners, Malaysia’s tourism minister revealed on Wednesday.
Chinese are the single biggest nationality to have taken advantage of the policy, known as Malaysia My Second Home, followed by 4,000 Japanese, out of a total of almost 32,000 foreigners granted residency since the scheme began.
