Land is one of the few investments which can be seen and touched. Not everyone cares about that sort of thing. But some people do, and these are certainly attributes which stocks and bonds don’t have.
Once in a while, I’ll speak to a client who wants to buy land in Asia. They have their own reasons and won’t settle for anything else, insisting on physical land. I almost always end up telling these clients to invest in Malaysia.
Not many countries in Asia allow foreigners to buy property – even condominiums and apartments. China, India, and most others in the region ban foreigners from owning any type of real estate.
A few countries such as Thailand and the Philippines allow condominium ownership. However, foreign ownership is truly rare when it comes to land.
Malaysia is a beacon for some investors because of its property laws and friendliness toward foreign investors. It doesn’t have the greatest economy when compared to the rest of Asia. But other factors help make up for it.
Buy Property in Malaysia
Foreigners investing in Malaysia have almost the same land ownership rights as locals. The only major restriction is on buying low and medium-cost housing.
Properties priced at under RM500,000 cannot be owned by foreigners. Some states, such as Penang and Johor, have an even higher minimum of RM1,000,000. This policy is aimed at separating the high-end sector from the rest of the Malaysian housing market.
It kind of makes sense. Otherwise, rich foreigners would drive Malaysian real estate values beyond the range where most locals could afford it.
Our guide to buying property in Malaysia has much more detailed information about this topic.
Buy Stocks in Malaysia
Malaysia also has one of the largest stock markets in Southeast Asia. Unfortunately, it’s not easy to open a bank or brokerage account in the country. You must be a resident of the country before banks will let you open an account with them.
There are still other options. Brokerages in Asia will often let you trade on stock exchanges throughout the region. You aren’t just limited to the country your bank is in. United Overseas Bank (UOB) in Singapore is one of the many I can recommend.
You aren’t living in Asia? Then your first option is to open a bank account in a place like Hong Kong remotely, through the mail. The second is to trade stocks in Malaysia through a brokerage in your home country.
I don’t suggest the second option. Brokerages in the US and Europe often charge high commissions for buying and selling stocks in Asia. You’ll substantially reduce fees by opening a more local account.
Is it a Good Idea to Invest in Malaysia?
There’s far better options if you’re seeking returns. Malaysia’s economy has done rather poorly over the past far years. Places like Cambodia and the Philippines are growing much faster and have better long term growth prospects.
But Malaysia is practically the only option in Asia for owning land while easily living in the country you’re buying property in.
The Malaysia My Second Home (MM2H) program, a longstanding government initiative, even gives investors a renewable 10-year multiple entry visa. Those under the MM2H program can even bring furniture, a car, and even a live-in maid to Malaysia from another country, free of tax.
In short, you should invest in Malaysia if you want to own land in Asia. Look elsewhere if you’re after profit.
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