Foreign interest in KL's residency visa plan plunges after rule change

New rule on buying and holding a property for 10 years turns off prospective applicants

- Zunaira Saieed

Foreign retirees have grown cold to the "Malaysia My Second Home" (MM2H) residency visa scheme, industry players say, after the latest revamped rules make it compulsory for them to purchase property in the country and hold it for at least 10 years.

Even a new category of visas for residents in special economic or financial zones, aimed at upcoming developments in Johor, is unlikely to lift demand for the scheme, economists told The Sunday Times.

British national Mohamed Shabir, 41, who had wanted to retire in Malaysia with his two children, said he changed his mind after finding out about the mandatory property purchase, although the bank deposit was manageable.

"I was interested in the Silver five-year visa scheme, and the mandatory property purchase does not make sense, and what is worse is the requirement to hold it for 10 years. I will keep my options open to other countries in Asia such as Thailand and Indonesia as I like the beauty and diversity of the continent," said Mr Shabir, who currently works at an investment bank in the United Kingdom.

Under the fresh guidelines released in June, qualified applicants are required to have bank deposits between US$150,000 ($203,300) and US$1 million, and buy a property with a minimum of value from RM600,000 (S$172,000) to RM2 million, depending on which category of visa they apply for. They also need to hold the property for at least 10 years.

Agencies that process applications for the residency scheme told ST that they are seeing a significant decline in interest, with as many as 90 per cent of prospective applicants losing interest since the new policy was announced on June 14.