KUALA LUMPUR (Aug 15): While lauding the government’s efforts in strengthening the background check on the applicants of the Malaysia My Second Home (MM2H) programme, The International Real Estate Federation (FIABCI) Malaysian Chapter also urged the government to review some of the conditions that might dampened foreigners’ interest in coming to Malaysia.
FIABCI Malaysia president Datuk Sri Koe Peng Kang said that the main objective of MM2H is to provide sufficient competitive incentives aided by security measures to attract the right group of applicants to assist the country in its economic growth.
“As such, the guidelines imposed must be balanced in terms of security and economic considerations. Hence, we would hope the government will revisit the latest conditions set because they may not be as competitive, and they may not be targeting the right segment of the MM2H market,” Koe said in a statement.
On Aug 11, the government announced the MM2H programme will resume online in October with 10 stricter criteria such as an increase of compulsory fixed deposits in local banks from RM150,000 to RM300,000 RM1 million, offshore monthly income increases to RM40,000 from RM10,000, the declaration of RM1.5 million instead of the previous RM500,000 liquid assets, as well as a minimum stay period of 90 days cumulative per year, which are usually terms required for Permanent Residency or Green Card applicants in other countries, under a social visa pass.
Lowering qualifying income
In view of the government’s efforts in attracting retirees who are looking for a second home, Koe suggested lowering some requirements, such as the monthly income as this huge group of applicants aspires to have a better quality of living when they retire.
“We would like to suggest lowering the qualifying income to RM 15,000-RM20,000 per month for those between the age of 35 to 49, who are most likely to have school-going children and this will help boost the demand for education institutions.
“If we target only the rich and famous, then we may consider a higher income bracket, but unfortunately, we are not in the position to target this group of people,” Koe noted. He is also S P Setia senior executive vice-president.
Meanwhile, as for the fixed deposit requirement, Koe reminds to take cognisant of the market recovery phases for various countries that we are targeting for this programme, the government may want to consider to impose only RM350,000 as the fixed deposit for applicants between the age of 35 to 49 years old who for many who would be bringing their children here for education.
“If the program is designed for a variety of countries, we probably need to make adjustments to the requirements due to income disparity. At the end of the day, we want to attract good law-abiding applicants at global scales,” he explained.
On the other hand, Koe in the opinion that the declaration of RM1.5 million instead of the previous RM500,000k of liquid assets would be a challenging criterion given the post-pandemic economic recovery for many.
“While the intention to narrow down the quality applicants is welcome, we would suggest a possibly better win-win solution where the government will consider only RM1 million of liquid assets and RM500,000 of fixed assets instead,” he shared.
Besides, Koe said that the new rulings are inhumane to demand the existing MM2H holders to seek and strengthen their finances significantly on such a short notice. Hence, the authorities must weigh the impact of the new rulings on the current law-abiding second home citizens before it is being gazetted.
“It would only be honourably fair to instead include a “grandfather clause” in the new rulings whereby the old rule continues to apply to some existing holders while the new rule will apply to all future cases.
“While we do support and welcome the government’s intention to enhance the program for a better Malaysia, the sudden huge increment may prove to be too much at this moment and is beyond our expectations. It is not an easy target market to start with, it would be very challenging for the Malaysia PEMULIHAN program as the stringent criterion would lead to minimal applications and a large drop in investors’ interest,” Koe concluded.
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