News and Views

Why Would You Retire Here?’: For Singaporeans Looking to Stretch Their Dollar, Foreign Property is an Option

November 1, 2023

“It’s expensive to retire in Singapore!” This is something you often hear from Singaporeans, who lament the country’s high cost of living compared with its Southeast Asian neighbours.

It is thus not surprising that locals and expats in the city state have been eyeing foreign property.

“In Singapore, you’re (living) in a condo, or you are talking about an apartment. But if you go to Bali, you have a house, you have a garden, you’re surrounded by the beach,” said Florent Delente, chief executive of market-entry consulting firm Emerhub.

“Why would you want to spend your retirement here (in Singapore)?,” added Delente, who was speaking at a panel at PropertyGuru’s Invest Asia Property Show at the Sands Expo & Convention Centre on July 29.

If anything, recent trends, such as the strong Singapore dollar – and the doubling of Additional Buyer’s Stamp Duty(ABSD) rates to 60 per cent for foreigners buying residential property in Singapore – have given them more reasons to consider overseas pastures.

Malaysia My Second Home (MM2H)

One attractive option, of course, is Singapore’s closest neighbour – Malaysia.

The Malaysian government’s Malaysia My Second Home (MM2H) visa programme encourages foreigners to live in the country.

Participants must have an offshore income of at least RM40,000 (aboutS$12,000) [N1] per month, prove liquid assets of at least RM1.5 million, and upon approval place a fixed deposit of RM1 million in any bank in Malaysia. These requirements came into effect in 2021 and were stricter than previous rules.

MM2H participants can buy property. However, property guidelines in Malaysia are determined by the respective states. In Johor, for instance, the minimum property price for MM2H holders is RM1 million. In Penang, it is RM500,000 per property, for up to two properties. Guidelines may change, so interested parties should check on the latest rules.

“I think for foreigners to show(sufficient) liquid assets, it’s not an issue. But the challenge is the income part, especially for those who are retired,” said fellow panellist Daisy Ong Danker, Deputy President, Malaysia My Second Home Consultants Association.

Another challenge is that people aged below 35 are not eligible to apply for the MM2H programme, even if they have sufficient income.

The government, however, is looking to set three categories for MM2Happlicants – Platinum, Gold, and Silver – and requirements will be relaxed.

“We are going to have tiers to cater to different categories of investors and foreigners. I think that’s good news. Just wait (for the details),” she added.

 Bali Beckons

Singaporeans have also shown a keen interest in properties in Bali, Indonesia, observed Delente.

“The capital gain has been very high over the last few years…Bali is definitely the number one for demand at the moment,” he said, noting that Batam and Jakarta are other popular options with Singapore residents.

“We had a lot of Singaporeans coming to us…for investments and capital gain, but also for relocation. Since COVID, people can work from home. Some people are looking to spend maybe two or three months in a different location. It could be Indonesia, but it could also be Malaysia or Vietnam. It is not only Singaporean nationals, but also a lot of expats from Singapore, who are looking for investment.”

Indonesia also has a “second home” visa programme, which requires proof of savings of at least IDR 2 billion (aboutS$176,000) in an Indonesian bank account.

“We also saw a lot of people coming for a second home in Indonesia,” Delente added.

Thai property market has untapped potential for Singaporeans.

While Thailand is a top holiday destination for visitors from Singapore, it is not a place where many of them buy property, said the third panellist Amin Parvin, Business Development Manager at AIMS, an immigration and relocation specialist.

“In Vietnam, Myanmar, and China, we have a lot of clients enquiring about properties in Thailand. This market hasn't been tapped properly in Singapore – I believe Singaporeans, or even expats who live in Singapore, have not seen the full potential of properties in Thailand,” he added.

“Singaporeans are not a major buyer yet…maybe it hasn’t been advertised well.”

Foreigners can buy apartments but not landed property in Thailand. A way to work around this is to own land in the name of a Thai company, Parvin noted.

“When you open a company, your company can buy landed property. A company must have a Thai partner (who owns) 51 per cent,” he added.

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