Malaysia eases rules for retirement residency visa but piecemeal announcement has wealthy foreigners holding off

Mr Ch’ng Toh Gee, managing director of Alter Domus – a licensed agency which handles MM2H applications – told CNA that since the announcement was made he has received “thousands of enquiries” and “hundreds of potential applications”.

However, he said that the applications cannot yet be completed because MOTAC has not announced the entire set of conditions for the new version of MM2H and that the agency does not know when this information will be released.

“In the new MM2H requirements, there is no mention of minimum income, no mention of (liquid) assets, no mention of how to submit a document and where to submit and how long to get approval,” said Mr Ch’ng.

“How all this will happen – nobody knows yet. We have to wait and see,” he added.

The MM2H programme, introduced in 2002, is a long-term visa scheme for foreigners to purchase property and reside in Malaysia. It was temporarily halted in August 2020 pending review by the Malaysia government, who was led by then-prime minister Muhyiddin Yassin.

In September 2021, the then-minister of home affairs Hamzah Zainudin announced that the programme would be reactivated with what was later deemed by critics as stricter conditions.

Mr Hamzah announced that participants would be required to have a monthly offshore income of at least RM40,000 (US$9,600), up from RM10,000 previously.

They also needed to have a fixed deposit of RM1 million, compared with the previous conditions of between RM150,000 and RM300,000.

Additionally, MM2H applicants would have had to prove ownership of liquid assets worth at least RM1.5 million.

Many observers said that the conditions set then disqualified many middle-income foreigners, and would only qualify ultra-high-net worth individuals, with the government reporting a 90 per cent dip in the number of applicants.

Among the critics was Johor ruler Sultan Ibrahim Sultan Iskandar who said the ministry’s reluctance to review the criteria was “mind-boggling and outrageous”.

Mr Ch’ng told CNA: “The MM2H conditions (set in 2021) were implemented without any thought into it at all. It was an arbitrary move,”

“The ultra rich would not even come to Malaysia, they would rather go to the UK etc, so the applications dropped to almost zero,” he added.

The latest version of MM2H unveiled by Minister of Tourism, Art and Culture Tiong King Sing last week has reignited interest in the scheme.

However, foreigners and agencies have expressed disappointment that the announcement seemed incomplete, especially given the anticipation it has drummed up. 

NEW APPLICATIONS STALLED DUE TO MISSING GAPS 

United Kingdom (UK) citizen Rebecca Spencer told CNA that she and her husband had been monitoring the news developments in Malaysia on updates on the MM2H situation as the couple is considering retiring in Kuala Lumpur if the conditions were relaxed.

The 48-year-old said that since the Malaysia general elections ended a year ago and Mr Anwar Ibrahim was appointed prime minister to lead a unity government, there have been optimistic developments on that front.

In tabling the national 2024 budget in October, Mr Anwar, who is also finance minister, said the government had agreed to relax requirements for the MM2H programme to boost the influx of foreign tourists and investors to Malaysia.

Moreover on Dec 4, Mr Tiong pledged that the revised MM2H programme would be announced in mid-December after a “thorough review”.

Ms Spencer told CNA she felt that there were “clear gaps” from MOTAC’s announcement on Dec 15 and that the income and gross assets criteria were glaringly missing.

“Those were the two conditions that proved to be the biggest barriers under the old criteria so it’s a bit perplexing why they did not state them clearly this time,” she said.

Ms Spencer added that since she and her spouse were retired, and mostly relied on dividends from investments as their income source, the RM40,000 per month requirement under the old criteria would disqualify their application.

“It’s very unlikely that retirees would qualify, even taking into account factors like pension. We were hoping for a much lower number or removing that condition completely. But as it stands, our applications are stalled,” she added.

Mr Andy Davison – founder and chief executive of The Expat Group (TEG) – a media organisation based in Kuala Lumpur that is also licensed to process MM2H applications, told CNA that on the surface, the new MM2H requirements “seem to be an improvement” as it widened the scope of foreigners who qualified.

However, he added that there was ongoing uncertainty on the income criteria, and when his team did checks with MOTAC, they have not received any concrete replies or confirmation.

“There are missing pieces and if they’re going to have a minimum income requirement, I assume, and hope it’d be much lower,” said Mr Davison.

“But nothing was stated regarding income. So I don’t know where they dropped it or whether there was just an omission from the announcement … we’re still trying to find out,” he added.

CNA has asked MOTAC if there are any changes to the MM2H conditions on offshore income and fixed assets, and if so, when will they be announced.