Number of properties sold to HK buyers expected to rise into ‘the thousands’

by FARA AISYAH/ pic by HUSSEIN SHAHARUDDIN

BUYERS from Hong Kong have bought local properties worth more than RM500 million since the almost daily demonstrations and as bruising clashes continued to rock the former British colony.

Millions of residents have gone to the streets to protest what they called the erosion of their rights as promised under the “one country, two systems” formula agreed by Beijing.

The protests, which started two months ago, are impacting Hong Kong’s position as a key regional financial hub. Hong Kong flourished during the British rule, creating a modern cosmopolitan and wealthy citizens, the envy of its poorer neighbour of mainland China.

These rich Hong Kongers are worried that Beijing’s rising intervention since the colony was returned to China in 1997 would impact their wealth. The younger generation is fearful their freedom would be suppressed by Beijing.

VPC Asia Pacific property consultant Bruce Lee said Hong Kongers have been snapping up high-end properties in Kuala Lumpur and Johor.

“According to the information that I had received, the buyers from Hong Kong have purchased at least 300 to 500 units of properties since June in several projects in Kuala Lumpur and Johor.

“Hong Kong investors had looked at Malaysian properties before, but now, there are only genuine buyers,” he told The Malaysian Reserve (TMR).

He said interest also peaked recently as more developers market their projects in Hong Kong. “(Even) more developers are planning to do the same.”

Properties in Hong Kong are among the most expensive in the world. It is also the most densely populated area based on size, encouraging residents to seek homes in other cities.

It was reported that young professionals from Hong Kong are looking to migrate elsewhere in the region and Malaysia is one of the preferred locations.

Lee expects the number of properties sold to buyers from Hong Kong would rise into “the thousands”.

“There are above 50,000 units of overhang homes in Malaysia, and if Hong Kong buyers snap up a total of 3,000 homes, it will be only 6% of the total overhang number.

“In addition, the Hong Kong buyers are purchasing properties that are priced above RM1 million,” he said, adding that local buyers would not be affected by the influx of these buyers.

Lee also said the purchases by external buyers, including from Hong Kong, would provide a respite to the stagnant market, especially for high-end properties.

Foreigners are not allowed to own properties valued less than RM1 million; low-and medium-cost residential units as defined by the state governments; properties on Malay Reserved land; and Bumiputera units.

Foreigners can acquire cheaper homes under the Malaysia My Second Home programme. However, the programme has strict regulations including a minimum of RM500,000 in their savings account/current account/fixed deposit accounts for individuals below 50 years, while individuals aged above 50 years need to have at least RM350,000 in their accounts.

According to the National Property Information Centre, Malaysia recorded a total of 54,078 overhang units worth RM37.23 billion in the first quarter of 2019.

Residential properties constituted the bulk of the overhang with 32,936 units worth RM19.96 billion, followed by serviced apartments (13,013 units at RM10.18 billion).