Selangor urged to lower price threshold for foreign property buyers

Land & General Bhd (L&G) urged the Selangor government to lower its price threshold for foreign property buyers, saying it would help developers amid the soft market as well as L&G itself secure higher sales.

“We had many enquiries from foreign buyers for Astoria Ampang — which is under the Selangor government’s jurisdiction — but the units are priced below RM2 million, so we cannot sell them to foreigners,” L&G MD Low Gay Teck told The Malaysian Reserve (TMR).

“We secured about 20% of foreign buyers for our completed project The Elements@Ampang, which is next to Astoria Ampang, but it is under the Federal Territory of Kuala Lumpur jurisdiction which allows foreigners to buy properties above the RM1 million threshold.”

Here’s all you need to know if you are buying a property as a foreigner in Malaysia.

He noted that the company may sell another 20% of Astoria Ampang should Selangor lower its price threshold for foreigners, which will significantly increase its revenue and profits.

The price threshold for foreign property buyers in Selangor is divided into three zones. The minimum price threshold for properties located in Zone 1 (Petaling, Gombak, Hulu Langat, Sepang, Klang) and Zone 2 (Kuala Selangor, Kuala Langat) is set at RM2 million. For those in Zone 3 (Hulu Selangor, Sabak Bernam), the minimum threshold is lower at RM1 million, reported TMR.

For this year only, however, the minimum purchase price threshold for strata properties – which include strata landed homes – was lowered by the state government to RM1.5 million throughout all zones.

“We hope the state government will look into this and revise the policy because there are very few RM2 million worth of properties in Selangor, particularly for high-rise units…There are definitely a lot of room for it to be lowered to below RM1 million,” said Low.

He revealed that the company has just handed over the units at Astoria Ampang Phase 1 to owners, who were mainly young and middle-aged buyers.

The RM840 million project comprises two phases of four blocks, with Phase 1 achieving a take-up rate of 77% or 391 out of its 506 units to date.

For his Budget 2021 wishlist, Low wants the government to explore ways in using the Employee Provident Fund (EPF) monthly contribution to service mortgage payments.

At present, buyers are allowed to access Account 2 of their EPF to fund their home acquisition.

“Assuming an individual contributes over 20% of his/her salary for EPF monthly, the amount itself can be used directly to serve the monthly mortgage,” said Low.

“That would ease up a lot of a buyer’s financial burden with the property prices today being not cheap.”

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