New price ceiling for foreigner buyer in Iskandar Malaysia

Johor, Malaysia – Mentri Besar Datuk Mohamed Khaled Nordin said that with effective from May 1, new ceiling price of RM1mil for foreigners buying properties in Johor will kick in. With this new ruling, it means that currently foreigners who buy Johor property above RM500,000 will need to buy it at the price of RM1 million and above starting 1 May 2014.

Mentri Besar Datuk Mohamed Khaled Nordin said that the new ruling would not affect developers who had received approval permit for their projects or already on constructions before 1 May. Developers within these categories will continue to sell the properties based on old price ceiling, which is RM500,000 to foreign buyers.

Mohamed Khaled told reporters at the pre-launch of 351 units of affordable houses that were priced between RM80,000 and RM150,000 by UEM Sunrise Bhd here yesterday.

Effective yesterday, the ceiling price of foreigners buying properties in Kuala Lumpur, Putrajaya and Labuan were RM1mil per unit, up from RM500,000 previously.

The Economic Planning Unit had on Friday said that for other states, the actual enforcement date was subject to the respective state authorities.

Besides of the new ceiling price, the foreigners processing fee of RM10,000 will lift up to 2% of property price. This will translate to higher processing fee based on individual property price proportionally. For instance, current RM1 million property foreigner buyer only need to pay RM10,000 for the foreigner processing fee, but in future he need to pay RM20,000 for the foreigner processing fee.

Asked if the presence of international property developers in Iskandar Malaysia, especially those from China, would create a glut in Johor, Mohamed Khaled said this was unlikely to happen.

Admitting that there were concerns about large-scale projects by international property developers that offered thousands of units of residential properties, he said that they had a strong financial background.

Mohamed Khaled said that action would be taken against developers who failed to build affordable houses despite having received approval from the authorities.

The project by UEM Sunrise would also see the company pledging to build 10,000 units of affordable homes in Gerbang Nusajaya, which will be launched in phases starting this year.


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