Finally Moving to Malaysia
 

So we're moving to Malaysia from Toronto on our MM2H within a few months. We're planning to move to Penang, which we prefer over KL (never been to Malacca or JB), but if we don't find a place we like in Penang, we'll look in KL.

We're not basing any decisions on House Hunters International (!) but in case some forum members are interested, there was a new episode on Penang first aired last month: www.youtube.com/watch?v=41mgCny5Rj0

Which condo building is choice #2? Of the 3 options, we'd probably chose #3. I think it may be a low-rise Quayside building which I've never seen but I've been in the 1-bedroom & 2-bedroom units of a first phase Quayside highrise building.

I've been wondering about mosquito fogging at a condo complexes like Quayside, Surin or around Gurney. I guess I should expect fogging once a week? Do they fog for mosquitoes all year or, if not, which months of the year? Does the fogging have an odour? I'm thinking that above the 10th floor, you won't get mosquito fog in your place, which I'd prefer, but coming from a house, I'm not used to high floors & heights, so if the fogging is not all the time, I might rather have a lower floor.

Re: Finally Moving to Malaysia
 

Interesting to watch the House Hunters video about Penang. Thanks for sharing the link Montakute.

For those interested in what happened next, the American couple in the video now run a medical tourism business here in Penang – see:

Breast Implant, Cosmetic, Eyelid Surgery, Boob Job, Plastic Surgery in Malaysia - Alternative to Thailand

In the video:

House #1 is at Ferringhi Villas, a gated development in Batu Ferringhi, opposite the Bayview Beach Resort Hotel

Condo #2 is probably Pearl View Condominium, on Pearl Hill in Tanjung Bungah, almost opposite the Penang Swimming Club

Condo #3 is at Quayside, the E&O development near Straits Quay Marina, Tanjung Tokong, behind the Tesco supermarket

I think mosquito fogging will be every 2 to 4 weeks, and unlikely to reach above the 4th floor. Normally there would be advance notice displayed in your building / letterbox, so you can close your windows. Also the fogging machines are noisy so you’ll here them start up anyway.

JC3

Re: Finally Moving to Malaysia
 

Interesting video, thank you for sharing.
One thing that you can observe from the video is that you really have to go and take a look for yourself. Not only to see the building and surroundings, but also to take a look at the amenities and the furniture. Each owner has his/her own style, so even within the same building you can have vastly different condo's.

Re: Finally Moving to Malaysia
 

That's very true.
A couple of things struck me when I watched the video about choosing a home in Penang
1) The American lady's huge concern about having an oven. Either ask the landlord to put one in, or buy a free-standing electric oven from Parkson department store. Easy. There are much more important things to worry about. (But perhaps the film was edited that way).
2) If sport / exercise is your thing, you can choose where to live such that fantastic gyms, or 5* beach hotel health clubs (pool, gym, tennis, Jacuzzi etc), and/or sports clubs with great facilities are only a few minutes away.

JC3

Re: Finally Moving to Malaysia
 

After living there, I cannot see really a reason to live in KL except you work there. The prices are high for renting and buying and if you want to buy there is a hefty 1 Million minimum. Make sure that you checked the place you want to rent not only at daytime. What seems to be nice and quiet at 3 pm can be unbelievable noisy at 3 am.

I came to Malaysia on MM2H like you. With the idea to stay either in KL or Penang. Finally I ended up in the middle, in Ipoh. Perak has many, many advantages, you can buy a luxury condo in Ipoh for a price the people in KL and Penang only can dream of. And if you don´t have the money for this super high end, you get cool stuff already for 350.000 which is the MM2H minimum price here. Have a look.

Re: Finally Moving to Malaysia
 

Why do MM2H,rs buy, as compared to renting?

I'm living in a lovely house where the rent would be less than the mortgage, but the climate is being hideous to the house, which wasn't built well in the first place.

Theoretically the rent pays the mortgage after about 15 years, but there won't be much of the place left by then. And it's a lot of money to invest in somewhere that if they change the laws or don't renew after 10 years, you can't easily make liquid.

Re: Finally Moving to Malaysia
 

It is not a 100% rational decision.

We want to completely design the place in the way we want it to have. We want to have some investment also in real estate, not just stockmarket and bondmarket. We think it is a good investment, the price is fair and leaves space for value increase. We want no negotiations with the owner. We want to get 150k out from our MM2H fixed deposit. I have to provide my wife the dream kitchen i promised before our wedding.

And so more things. But of cause there are also a lot of reasons to rent.

Re: Finally Moving to Malaysia
 

That’s an interesting question, and as an MM2H buyer in Penang, it’s one that I struggle to answer. For us, it’s mostly an emotional thing. My wife and I loath renting, and like nest building.

It appears that the majority of retired MM2H’ers rent, and of those that do buy property, most are cash buyers. Some will also own more property in their home country, which helps them maintain a toe-hold were property prices in their home-country to rapidly increase.

So far I haven’t met many retired expats who intend to live in Malaysia until death. Many Brits would return to the UK if their spouse died, or if they needed to use the NHS. Medical insurance gets prohibitively expensive in your eighties and nineties. Being out of the property market in both countries is perhaps risky.

Personally I wouldn’t consider buying a condo on Penang island, only landed property. And I wouldn’t buy without renting first. With Penang being an island, land is in short supply. So in my view a house on a reasonably big plot (with room to extend - either yourself, or by the future buyer) in a desirable area (location, location), is a reasonably safe long-term bet, especially given the new roads and infrastructure being built on the island over the next few years.

The big problem in Malaysia as I see it, with both condos and houses, is poor build quality and poor maintenance. A brand new condo in 10-15 years will probably not be as desirable as it once was, especially as Malaysians prefer to buy new. At least as the house owner you have control over its maintenance.

So here are some benefits of owning:

• With no mortgage, or once you’ve paid it off, the home is yours and you can live there rent free.

• Owning removes some of the ongoing exchange rate risk if your income is in Sterling.
• If you choose the location well, and find a home that has something unique about it (i.e. that is not one of dozens of similar properties), your home will probably increase in value, by considerably more than 4% a year, i.e. the natural (dividend) yield you might get from a diversified share portfolio.
• If you spend money renovating or improving your home you can further increase its value.
• You can renovate, decorate and furnish it to your own taste (thereby avoiding vomit yellow sofas), knock holes in the walls, and put in good quality appliances
• You can design and plant the garden how you like – that’s important to me. I love gardening. But only for me, not for a landlord.
• As an owner (of strata property) you get a say in how the place is managed. Potentially a very big say if you join the management committee. A tenant gets no say at all. For example, I helped change our additional by-laws (House Rules) to prohibit short-term holiday rentals – now the minimum rental period permitted is three months. No holiday lets has made a huge difference to the quality of life at our development. It’s now quite exclusive, and no longer a holiday camp!

Some of the downsides with buying property are:

• It could take a very long time to sell it again
• The exchange rate may go against you if you want to leave the country
• You might not get your MM2H visa extended (unlikely in my view)
• Currency controls may be imposed
• The property bubble could burst just at the wrong time
• You could fall out with the neighbours and not be able to upsticks in a hurry
• If you’re living with someone and split up, deciding what to do with the property can be complicated and expensive. But she loves me….and I know which side my bread is buttered.

JC3

Re: Finally Moving to Malaysia
 

Hello Montakute,
Everyone has a different opinion on what's most important when moving to a new area/city/country.
Certainly when you are paying a Premium price for a apt/condo in Penang (???), you should be picky (Gym/Oven...LoL) about what you are getting. From what the TV program showed apt #2 seemed like the best choice.
They briefly touched upon Location ("how far to G-town"), but if you're really deciding to live here...most important to me is "where everything is located". Am I within walking or short easy drive to shopping, restaurants, food, entertainment, etc...What is located outside of the condo complex...or what I like to call the Tourist/Expat Bubble.
Look at the condo side, but also ask to see what the neighborhood is like outside the complex.

Re: Finally Moving to Malaysia
 

Interesting clip for someone like me who is interested in moving to Penang. They should had read some posts from the ex concierge & ex moderator and they might have realised that it's a renters market to negotiate a better price.

Re: Finally Moving to Malaysia
 

Great overview JC3. I think that you need to add one item, which is specific to Penang: after buying property you can't sell it within the first five years (unless you're Malaysian).

My personal choice: I rent because I don't want my money to be stuck in a pile of stones and not being able to make it liquid the first five years. And I'm not sure that investing in real estate is a good thing in Penang because there are so many new developments ongoing. This could result in a bubble, about to burst. I rather invest my money in some other category.

Re: Finally Moving to Malaysia
 

Hi and thanks
I think foreigners in Penang cannot dispose of or transfer their property for 3 years (not 5).
Another potential hurdle is RPGT (CGT) which is 30%, dropping to 5% after five years ownership

JC3

Re: Finally Moving to Malaysia
 

Ah, thank you for clarifying this. I might have mixed up these two things. The combination of both make it prohibitive to me to buy real estate here in Penang.

Re: Finally Moving to Malaysia
 

If you are planning to buy a condominium, here is a check-list and interesting read on buying a condominium

Re: Finally Moving to Malaysia
 

KL usually is choice for beginner to try adapt the environment because public facilities are more complete compare to others city.

Re: Finally Moving to Malaysia
 

I wouldn't worry about it. I've been renting in Penang since I got my MM2H in 2011 and I've never had a problem with it.

If looked at from a pure economic perspective renting is far and away the better option, but the reason people buy, especially in retirement is to ensure security.

I can completely understand that justification, but you have to realise that you are paying a premium to buy which does not exist in rental situations.

Re: Finally Moving to Malaysia
 

King, I agree with your view and will continue to rent.

Re: Finally Moving to Malaysia
 

Yes, but you cannot take it with you.

Re: Finally Moving to Malaysia
 

True bakedbean, but money that I don't spend elsewhere can be allocated to drunken debauchery and naughtiness, which is my personal preference.

Re: Finally Moving to Malaysia
 

I think from an economic perspective the “Is it better to rent or buy?” question is a difficult one.

Something to think about if you have the cash available to buy a property, is what annual return you could get on your cash by investing it elsewhere.

For example, if you had bought a detached home in Penang in Q1 2011, five years later in Q4 2015 it was worth 83% more, a gain of about 13% a year. Of course one has to factor in buying and selling costs and RPGT/CGT (5% on the capital gains made, if you sell after five years).

On the flip side, if you were a cash property buyer you would have also saved yourself from shelling out rental payments every month for five years.

In my view it’s not very easy to get a 13% annual return from stocks and shares without taking substantial risk.

See some malaysia-house-price-index figures here:
http://britishexpats.com/forum/malay...2015-a-878806/

Other concerns with buying include winning or losing on the exchange rate, a property crash, and very importantly – can you sell the property again when you want to?

JC3

Re: Finally Moving to Malaysia
 

I could never afford to buy any property until I left the RAF and worked abroad...so FWIW.....

Since then I've only bought places to live-in and not intended for speculation ... yet all those properties have made substantial gains when sold (2 in Hong Kong; 3 in Vancouver; 1 in Arizona; 1 in London).
Currently we reside between an apartment in Jakarta and villa in Bali and both have increased in value considerably...but not sold.

I've also invested in stock markets, and now mutual funds, and none of those investments, which were planned to make money, have been as good earners as the un-intended properties have been.

Please don't ask me about the yachts I've failed to make any money when selling...I get a red-face....:o
However I did sell a Mercedes 350SL, after 10 years, for more than I paid.

Re: Finally Moving to Malaysia
 

To quote an old adage, 'Past performance is no guarantee of future performance'

Anyone lucky enough to have bought into Penang 5-10 years ago will have made a pretty profit by getting in at the start of the property boom. I don't regard this as any kind of indicator that it would be a sensible thing to do today. Looking at one of the property websites a few days ago suggested that property prices in Penang have been slowly declining over the last 12 months. I do think the property boom is over for Penang with each new development trying to out luxury the previous development, last year's super properties will become less desirable and their value should fall.

Like Davita I have made some spectacular gains from various properties that I have lived in but now in my sixties the aim is to enjoy some of those gains rather than pass them on to family. So the need to own a growing asset seems less relevant than when I was in my twenties.

I've just checked the funds that I invested in 5 years ago and my gain is around 55%. Maybe not as good as JC3's house but my profit is easily realisable tomorrow without becoming homeless. For retirees in Malaysia I find it hard to justify property purchase in today's climate.

Re: Finally Moving to Malaysia
 

I agree with NeonHippy - 'Past performance is no guarantee of future performance' and property prices in Penang have definitely slowed considerably over the last year or two. As a result developers are slowing down new builds, and the launch of existing projects nearing completion.

It’s perhaps also worth noting that there’s something like a 13 year oversupply of apartments and condos in Penang (i.e. it would take 13 years to sell all those available for sale at the present rate of transactions).

Is the property boom over on Penang Island? Who knows?

In my view:

• Development land is in increasingly short supply, with any empty land along the coast between Gurney Drive and Batu Ferringhi (and now Teluk Bahang) being built on or snapped up by developers for their landbanks.
• The planned new highways and public transport masterplan will have a huge impact making some parts of the island much more attractive to potential buyers.
• Penang is a unique place in Malaysia. It’s somewhere that many Malaysians dream of retiring to.
• Landed property is generally a better long term bet than condos – however buying landed property is more expensive now for foreigners.

Since February 1, 2014 the thresholds (for foreigners) are:
MYR 1 million for all types of property in Penang State (Or RM500,000 for foreigners with MM2H)
MYR 2 million for landed property on Penang Island (Or RM500,000 for foreigners with MM2H)

More views, facts, and figures on the Penang Property Market here:

Penang - A Sustainable Property Market

Penang property market immediate outlook challenging, says Knight Frank Malaysia | Penang Property Talk

Henry Butcher Penang Property Market Research Report 2016 (13 pages)
http://www.henrybutcherpenang.com/up.../HB%202016.pdf

JC3

Re: Finally Moving to Malaysia
 

Whilst agreeing with neonhippy's theme of 'when do you stop thinking investing and retire happily' and is an objective that I now pursue...I'm 80 next birthday and still find that concept difficult and always looking for the next good investment...it's a Scottish thing!!!

I love the idea of at least having one property to call your own but agree that investing in property in 'foreign lands' does have risk. A devalue of assets can be recovered when one is younger, and employed, but more difficult in senior years.

Therefore, having a diverse portfolio is the key to a good sleep...and a decent stock of wine...:nod:

Re: Finally Moving to Malaysia
 

Only on paper!! The property market is not exactly buoyant at the moment.

I have flip-flopped, u-turned, on whether to rent or whether to stay in my bought condo, and current thinking is to continue staying in my bought condo unit** Why? It's mine. It's a bit of security. Nobody to kick me out.

I've heard of a couple of friends recently who are having to move from their rented flats. The owners wish to put the flats on the market (though I could tell them that the property market is not good).

What I am saying is.... what if you are in your 80s and renting. Do you want to be still moving around every few years? Maybe a few health problems. I know...being so cheerful keeps me going :sneaky:

(** unless I change my mind again)

Oh...and another thing I have noticed amongst friends is that those who advocate renting usually have a little bought bolthole somewhere in the world to "go back" to. A bit of security somewhere else.

Re: Finally Moving to Malaysia
 

Yup. Therein lies the rub.

I’ve met several retired expats in Penang who sold up in the UK and have been here a few years, who now lament that they could no longer afford to buy the home they sold in England if they moved back. Some feel stuck here, and it seems that very few British expats intend to live in Malaysia until death. This is partly because they’ll probably need the NHS in old age, and private health insurance gets very expensive in your seventies and eighties.

With average house prices in England increasing by about 28% over the last five years (i.e. about 5% a year) it’s easy to see how house prices can run away from you.

Once off the UK property ladder for a few years, inflation and increasing house prices can make it almost impossible to get back on again without downsizing. If you brought your capital to Malaysia and were also unlucky with exchange rates going against you, then that 28% house price increase could easily double.

These days, £11,321 buys just one square metre of a home in Chelsea. Gulp!

JC3


UK house price data here:
UK House Price Index

Re: Finally Moving to Malaysia
 

We’ve been toying back and forth buy/rent for some time now, erring towards renting, rental is fairly low in comparison to cost to buy. Finally looks like we’re be moving to Penang in a couple of months the thinking currently is to rent out the houses in the UK where yield is higher, typically 4 – 4.5% in the south and use that money to rent a condo (location TBC) with the difference letting us live until such time as pensions et al kick in. Not sure what we’ll be willing to pay but looks like somewhere around RM3K should get somewhere. Not that falling pound is helping the calculations.

With the buying rules now if we were to look for property to buy I’d be concerned about possible falling prices and Condos don’t always age well so it would have to be landed and with me on the deeds that’s RM2Million not the sort of loose change I have without selling in the UK.

Re: Finally Moving to Malaysia
 

Sounds like a sensible plan to me. Do your homework re rentals then ask,on here. In Penang there are a LOT of empty units. So bargain hard.

Re: Finally Moving to Malaysia
 

Do real estate agents in Penang typically work showing rental units every day of the week? I'm used to real estate agents showing places on weekends in North America but I'm wondering if perhaps it's the norm in Penang that agents don't typically show properties on Friday/Saturday/Sunday.

Re: Finally Moving to Malaysia
 

True there are a lot of empty units around at the moment but not all of these are available for rent. It is (to my mind at least) a crazy view of the Chinese that it is OK to buy property purely to sit on for the capital growth.

I know of three terraced houses in a row that are at Straights Quay that have never been connected to the services. I also recently looked around a quite old development on Pearl Hill and was shown a unit that the owner had bought as a shell and where the wiring was hanging out of the walls because he had never even bothered to fit wall sockets or light switches!

Bargaining hard depends much upon your expectations and what you are prepared to accept. There is an awful lot of tat around at the moment and yes you can bargain hard for these if you are prepared to accept them. But every now and then a gem pops up. Not everyone reads this forum and if you bargain too hard you could loose that gem. This happened to me only last week. We had been bargaining for a beautiful landed property for a couple of weeks when we got a call from the agent stating an American had viewed the property and agreed to pay full price with no wish list there and then.

Re: Finally Moving to Malaysia
 

Generally yes although many are Christian and will attend church on Sunday morning. They seem to work all hours and we have woken up to find messages suggesting properties to view that were sent after we went to bed.

Re: Finally Moving to Malaysia
 

Ditto. The agent I have used in the past works whenever and usually busiest at the weekends.

Re: Finally Moving to Malaysia
 

Hi all. Happy to report we are now in surprisingly cool Penang! Got here Nov 1. Walking all over the place and really loving all the inexpensive food we've had.

Two 11-hour flights from Toronto to KL which would have been grueling except we were in Business Class on points, with a lie-flat bed and on-board chef, so cannot complain. At customs/immigration, we were a little worried about some stuff we brought in our 4 large suitcases but the officer only asked one question: "Do you like my music?" .. when we smiled at the surfing music he was listening to.

Overnight at the Sama Sama International at KLIA (heartily recommend, great buggy ride which whisks you from the terminal thru the elevated walkways to the hotel).

Gave our heavy sweater jackets the next day to the Malaysian Airlines attendant at the gate for our flight to Penang, we were tired of carrying them around and she seemed to like them, then kinda regretted it later when we entered Sam's in Gurney Paragon which was freezing that day.

Took a taxi tout at Penang airport which they say you shouldn't, but we would have had to take the 89RM van due to our luggage and this guy saved us 20RM or so and he gave a very nice ride.

Very disappointed that none of you told me the side-by-side escalators at Tesco go the same direction, unlike at home - caught a couple smirks as we trudged UP the stopped DOWN escalator assuming it was an up escalator simply not working.

Looking for a furnished condo rental, ruling them all out as I kinda expected (we are very good at finding all the negatives about a place unfortunately). But all the ones we've seen are actually very clean and in better condition than we expected and what we experienced rental house-hunting in Toronto after we sold our house recently.

Looking at one unit that is unfurnished but agents say landlord will furnish (for higher rent of course). But we have to sign a lease soon and are skeptical that we'll get good quality furnishings, especially after the lease is signed. If anyone has experience with doing that, please share.

Re: Finally Moving to Malaysia
 

Welcome to Penang ;)

It's a renter's market, as you probably already know. Most units seem to be furnished so I would keep looking. If your agent is not accommodating then just get another one.

Re: Finally Moving to Malaysia
 

Ditto the welcome to Penang. I wish I had known you were giving away your heavy jackets as we have to go to Toronto in February for our son's wedding, bbrrr.

As BB said, most apartments here come 'fully furnished' but many have been furnished with reclaimed furniture from the dump IMHO. But keep looking there are some pearls out there. I have just vacated a nice apartment with stunning views and can put you in contact with the landlord if you are interested and PM me. The downside to that apartment is that it may only be available for around a year before the owner (a brit) moves out here and it's proximity to the floating mosque.

Re: Finally Moving to Malaysia
 

Funny story about the Tesco. Rest assured that they have escalators going up and escalators going down. They're just not side by side.

Using Uber would have been cheaper than the tout you used.

I hope that you will soon find a condo you like. There are so many empty condo's out there that surely there must be one which fits your requirements.

Re: Finally Moving to Malaysia
 

Ah but Uber will require one to have an internet connection while en route :sneaky:

Somewhat off topic but I got an ad popped up for Grab today. Wasn't aware that we had that in Malaysia. I tried Grab last week in Singapore...on somebody else's phone. Seems to work quite well.

Re: Finally Moving to Malaysia
 

Thanks for the Welcome.

Re UBER, we didn't have our SIM card when we arrived at the airport but have since used UBER and have found it a great way to get around. Clean cars, nice drivers and very inexpensive.

After just over a week of looking at many places, we put in a rental offer on a (furnished) unit last night. We don't know the exact terms of our offer i.e. date and price because our agent didn't tell us. :lol: She had suggested a price so we gave her a narrow price range and said we were flexible about the date. It's just a verbal offer so far. We think it will be too low though.

It is not located in our first area of choice around Gurney, as we seemed to find Gurney units are either too big, too expensive or too rough. Also we encountered a number of smelly drains in units there, which could even stink up the place, not sure why. Too bad because we did find one affordable & good unit for us on Gurney Drive, but on our second visit the unit smelled from a stinky bathroom drain even though the unit had been closed up for only one day.

Re: Finally Moving to Malaysia
 

You could always go back to that unit and ask if the landlord will fit drains with built in traps. All you have to do is then make sure the traps contain some water and you won't have any odor problems again.

https://ae01.alicdn.com/kf/HTB1GPUyH...teel-waste.jpg

Re: Finally Moving to Malaysia
 

Thanks, owned. I didn't know there were add-on devices like this because I'm more familiar with those S pipes that store water to prevent smells.

Not sure yet where we'll end up but we're also looking at new condo's like the ones at Quayside built this year, now becoming available. We happened to be talking to a salesperson at Astro (we dunno if we'll get Astro but anyway).

He said that for the Fibre Broadband (which is TIME Fibre) used by Astro IPTV, the installer drills a hole in the front door of the condo unit to get the cable into the unit, and then they string the exposed cable along the floor or ceiling to where you want.

Is this is correct and how it would work at a new condo such as Quayside? I'm more used to the cabling running in central ducts/passageways inside the building somewhere and then the cable comes into the unit through an access 'hole' on a wall where a TV might be placed. Attached is a photo of a wall at the unit we looked at.