FIC guidelines review welcomed

The government should raise the selling price of residential units for foreigners to RM350,000 instead of the current level of RM250,000 to help local buyers, Fiabci-Malaysia honorary treasurer Yeow Thit Sang said.

“This way we can be seen to be helping our local buyers,” he said. The government had in December 2006 allowed foreigners to buy residential units costing RM250,000 or more without the need to seek the Foreign Investment Committee’s (FIC) approval.

The move is aimed at encouraging foreign investors to purchase high-end residential units but there is also a strong demand for residential units costing RM250,000 or more from local buyers.

Nevertheless, Yeow said any positive changes in the FIC guidelines to ease the sale and purchase of real estate property was most welcome, as Malaysia was one of the most favourable country for the purchase of real estate property in Southeast Asia.

“The foreign investors who bought commercial property will need to pay assessment, quit rent and other form of taxes, he will definitely have to occupy or rent the premise to others to make any meaningful return,” said Yeow.

Zerin Properties Sdn Bhd’s chief executive officer Previndran Datuk Singhe said foreign investors should be free from the compliance to have or increase bumiputera equity to at least 30% to acquire bigger commercial properties in Malaysia.

He said the lifting of this restriction on foreigners to own larger commercial properties would have a positive impact on the economy.

“The owners of the foreign companies will not have to apply for exemption (exempted from the compliance to allocate 30% stake for bumiputera), they will not have to report back to their headquarters and so forth,” he said.

Finance Minister Datuk Najib Razak on Monday said the FIC guidelines would be reviewed to attract more foreign investors, especially in the property and commercial sectors.

Nevertheless, Previndran said Malaysia would remain one of the top choices for foreign property investors in view of its relatively low-priced properties as compared with Singapore and Hong Kong. “Malaysia is also among the few countries that offer foreign investors to hold freehold properties,” he added.

Yeow said besides being an English speaking country, Malaysia’s laws on sale and purchase and taxes were most favourable.

“These are all factors that will encourage foreigners to invest in the country. The awareness of all these favourable factors is not make known to the world. There is a need to do this is a big way,” said Yeow.

The Nomad Group Bhd’s (formerly Kuala Lumpur City Corporation Bhd) chief executive officer Hew Thin Chay said the government should also focus on the bigger picture by boosting foreigners’ confidence in the country’s security and stability.

“The big picture plays a more vital role. For foreigners, the stability and security of the country are very important. The government should also ensure efficiency in the process for foreigners to obtain approvals,” he said.

by Yantoultra Ngui Yichen (The Edge Daily)

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