As a continuation of the previous posting for $KSL / 5038 (KSL HOLDINGS BERHAD) and $PLENITU / 5075 (PLENITUDE BERHAD), the Property sector has benefited from the budget 2024 that was announced on 13th October, last Friday.

Firstly, the government's intention to make the MM2H program more accessible to foreigners is a notable development. However, as the specifics are still pending, a stricter MM2H regulation could potentially make it more challenging to apply for the program, limit opportunities for foreigners to reside, work, and invest in Malaysia, and introduce greater uncertainty and instability for current MM2H participants. Consequently, this news may bring to the opposite effect. You can refer to the current MM2H regulations provided below:

"• Those who are younger than 50 years old must have a minimum liquid assets of MYR1,500,000; a Minimum offshore monthly income of MYR40,000; and a fixed deposit account in Malaysia that contains at least MYR1,000,000
• Individuals who are 50 years or older must have a minimum liquid assets of MYR1,500,000; A Minimum offshore monthly income of MYR40,000; and a fixed deposit account with a Malaysian bank that contains at least MYR1,000,000
• Other requirements include: The annual visa fee is MYR500 and there will be a processing fee charged by immigration of MYR5,000 for the principal applicants plus MYR2500 for each dependent; the requirement to stay in Malaysia for 90 days"

Another important point is the allocation of RM10 billion to expand the Skim Jaminan Kredit Perumahan, which will enable 40,000 borrowers to purchase properties. This allocation is twice as much as the previous 2023 budget, which only provided RM5 billion for 20,000 borrowers.

Third, infrastructure projects like LRT 3 and Penang LRT can support the demand for property in certain areas in Malaysia. In this case, both projects are expected to have a significant impact on the property markets in the respective areas. LRT 3 will connect major residential and commercial areas in Klang Valley, while Penang LRT will connect the island's two major cities, George Town and Seberang Perai. As a result of these projects, property prices in areas near the LRT stations are expected to rise. This is because properties in these areas will become more desirable to buyers and tenants, due to the convenience and accessibility that the LRT provides.

Unfortunately, the implementation of the 4% flat rate stamp duty (previously tiered rate of 1-4%) on the Memorandum of Transfer by non-citizens and foreign-owned companies may negatively affect buying interest by foreigners marginally. However, this rate is still lower compared to other cities in other countries as shown in the picture.

So far, these are what I can conclude about the effect of budget 2024 on the property sector. Feel free to post your thoughts!