There has been a five and a half times rise in Chinese investor interest in Malaysian real estate.

Chinese buyer enquiries for Malaysian properties rose 550% in the year to August 2016 on a property website and Malaysian online property listing views increased by 52.7% in the same time period.

Real estate in Malaysia is ranked 11th worldwide in Chinese buyer interest.  The average value of property searched for is US$224,000.

Charles Pittar, Chief Executive Officer of China's largest international property website, tells OPP.Today, “China was the biggest source of inward investment to Malaysia last year across the board, not just in property. Some of the investment in industry and development has positive spill-over effects for residential property.

“On top of the economic ties drawing the two companies closer together, Malaysia’s property sector is making a concerted effort to attract Chinese buyers. They are locating and designing projects to appeal to Chinese as well as locals, and they are marketing them in China. Despite the fast growth, Chinese buyers are still only a significant minority in the marketplace.

“For Chinese buyers, Malaysia is a nearby, easily accessible country with an appealing and very affordable housing market. Money invested there is perceived to be at greater risk than it would be in a larger economy like the US or Australia. Malaysia tends to attract buyers pursuing investment or lifestyle strategies, who have other family or commercial ties to the country or who simply cannot afford to purchase in a market like the US or Australia. Unlike, say the UK, Malaysia does not attract many buyers motivated by education.”

Currently, the Malaysian real estate market is strong, says Mr Pittar. “I believe Malaysia home prices are up 7.2% year-on-year. We think the outlook is good for the market, although it does face some headwinds.”

The Chinese buyer profile in Malaysia is very different than in nearby Singapore, says the property website, with 54% of buyers in Malaysia motivated by investment, and only 15% by education. This is nearly reversed in Singapore, with 59% motivated by education and 23% by investment.

When looking at leading Southeast Asia by enquiries in Quarter 2, 2016, Malaysia is third, behind Thailand (fourth globally on the property website) and Singapore in eighth place. It is ahead of Vietnam, in 14th and Indonesia in 15th.

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