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Unbelievable growth in MM2H reflects Sarawak’s allure

Sarawak remains a highly attractive destination in Southeast Asia for individuals of various nationalities.

Sarawak remains a highly attractive destination in Southeast Asia for individuals of various nationalities.

 

Unbelievable growth in MM2H reflects Sarawak’s allure

The most recent data from Malaysia My Second Home (MM2H) and Sarawak-MM2H indicates that Malaysia, especially Sarawak, remains a highly attractive destination in Southeast Asia for individuals of various nationalities.

Following the reforms implemented in late 2021, the MM2H programme garnered 1,905 successful applicants out of 2,164 applications. Of the total, Sarawak authorities granted 406 approvals by the end of July 2023, hinting at an estimated total of around 700 for the entire year. 

Moving from 27 to 700 approvals or 3,200% underscores the significant surge in interest, said Juwai IQ co-founder and group chief executive officer Kashif Ansari, adding that the statistics underscore that there continues to be substantial international demand, affirming the ongoing success of the MM2H programme.

“The high approval rate is evidence that the programme attracts the kind of person Malaysia wants. These are relatively big spenders who tend to buy or rent homes in touristy locations. They don’t compete with Malaysians for housing.

“The Sarawak programme’s requirements differ from those of the federal programme. In Sarawak, the minimum bank deposit is RM150,000, while the current federal programme requires a minimum deposit of RM1,000,000. 

“The Sarawak programme also has lower residency and annual income requirements than the new federal programme. For example, you must spend 30 days a year in Sarawak under its terms, which compares to 90 days for the federal MM2H. And you must have a minimum annual income of RM84,000 for Sarawak MM2H. The federal MM2H programme requires a minimum annual income of RM408,000,” he said.

Who benefits? 

“Our data shows the most common MM2H participants are retirees who have fallen in love with Malaysian culture and lifestyle. They want to live here and learn more about the country. The locations that benefit most from MM2H are popular vacation and second home markets where the lifestyle most appeals to retirees,” he added.

The MM2H programme, beyond its cultural appeal, bestows several economic advantages upon Malaysia. It lures high-spending tourists and residents who actively contribute to the economy through expenditures on accommodation, dining, shopping and various services. This financial influx bolsters local businesses and has the potential to stimulate job creation.

Furthermore, the programme catalyses positioning Malaysia as a premium and enduring tourism destination. Long-term tourists, characteristic of the MM2H programme, exhibit more substantial local expenditures than their short-term counterparts.

In addition to boosting tourism, the MM2H programme aids Malaysia in attracting new demographics of tourists, particularly affluent and long-term visitors. This diversification is particularly valuable in the current context, where overall tourist numbers are still recovering from the impact of the pandemic.

Malaysia’s competitors 

Several countries vie for the same pool of tourists, with Malaysia facing stiff competition from Thailand, Indonesia, Cambodia and the Philippines. All these nations boast visa programmes that directly rival MM2H and Sarawak-MM2H, each consistently updating its offerings to maintain competitiveness.

MM2H stands out partly due to Malaysia’s unique provision allowing foreigners to own property. The property acquisition process here is streamlined, allowing foreigners to purchase houses on land, a privilege not extended in Thailand where ownership is limited to apartments.

Additionally, Malaysia’s cost of living contributes to its attractiveness. For instance, the cost of living in Manila, Philippines, is 12% higher than in Kuala Lumpur. Living in Bangkok comes at a 25% higher cost, while Phnom Penh sees a 27% increase in expenses. Among the four capital cities with residency programmes rivalling MM2H, only Jakarta shares a cost of living on par with Kuala Lumpur’s. This cost-of-living analysis is based on data from Numbeo.”

MM2H’s future 

“Other countries are competing for the same tourists. Malaysia’s biggest competitors are Thailand, Indonesia, Cambodia and the Philippines. All four countries offer visa programmes that compete with MM2H and Sarawak-MM2H. Each country regularly updates its programme to stay competitive with the others.

“MM2H is attractive in part because Malaysia allows foreigners to own property. Purchasing property here is a straightforward process and foreigners can buy houses that sit on land rather than just apartments, which Thailand prohibits,” said Ansari.

The relatively tepid reception of the Malaysia Premium Visa Programme (PViP) also underscores the high level of recognition MM2H holds among foreigners. Despite sharing similar requirements with MM2H and offering a much longer and renewable 20-year term, PViP has not garnered significant traction. In its inaugural year, only 57 applicants sought a PViP visa, with only 28 approvals granted—far fewer than the expected 700 MM2H approvals this year.

A steady number of applicants is anticipated for MM2H and Sarawak-MM2H in 2024. The sustained success of MM2H and Sarawak-MM2H underscores Malaysia’s enduring appeal to expatriates and retirees. These programmes stimulate increased spending and employment, contributing to Malaysia’s standing as a long-term tourism destination. Despite regional competition, Malaysia’s unique blend of lifestyle, cultural richness and financial incentives is poised to attract a considerable number of international residents in 2024.

 

Source: StarProperty.my

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