Penang is a charming island with an old cultural heritage, located in the Northwestern parts of Malaysia – one of the top choices when foreign retirees and expats decide to settle down in the country.
Voted as one of the top 10 destinations to retire in the world as living costs are low, the weather on the island is great enough to enjoy one of the best cuisines in the world. It is worth mentioning that according to Forbes in 2018, Malaysia was voted as the 5th best country to retire in, where Penang is undoubtedly a significant contributor.
Since long back, the Northern parts of Penang have been the preferred among foreigners.
You can find more leisure activities and points of interest compared to the Southern parts, especially in areas of Georgetown to Batu Ferringhi. Some examples are the colonial buildings and local architecture, the Botanical Garden, Penang Hill, Penang National Park, Shoppings and more.
The Southern part is more local and less expensive, but have gained more traction among real estate buyers and long-term renters, and should also be of interest.
Gurney Drive is one of the most popular areas among MM2H holders and foreigners, mainly from Hong Kong and Europe. It’s on the top of our list as it offers many modern conveniences and high quality of life in general.
Expats that hold management positions in international companies tend to prefer Gurney Drive, as it’s located within a short distance from areas with more commercial activity and corporations.
If you decide to buy a condo or a house here, you’re able to reach shopping malls such as Gurney Plaza & Paragon Malls, hawker centres, and other amenities within walking distance.
Foreigners that look for bigger units (above 2800 sqft / 260 sqm) and that have a budget above RM5000 often choose places like:
Those with lower budgets, mostly coming from India, Korea and China, tend to go for Gurney Beach, PG 1 Condominium and Gurney Park.
Most of the MM2H-holders and foreigners who choose to live here are European, Americans, Singaporeans, Korean, Chinese professionals and retirees. Here, you can enjoy a beautiful sea view and direct access to the beach.
Tanjong Tokong, which is located nearest to Gurney & Georgetown, has become one of the top choices. The most up-market and exclusive seafront residences that offer modern amenities and convenient living is in Seri Tanjung Pinang.
It comprises resort-styled condominiums, suites, colonial-style courtyard terraces, semi-detached houses, and landed properties with private pools. Rentals range from RM 3000 – 9000. Prices are around RM 10,000 per square meter and onwards.
Exciting projects in Tanjong Tokong and Tanjung Bungah include:
Foreigners that have lower budgets with Penang standards, which is generally below RM 3000 in Tanjung Tokong, tend to choose property such as:
Popular condominiums sizes above 4000 sqft located in Tanjung Bungah with beachfront include:
Many MM2H-holders and expats that come with families up to 4 – 5 people prefer to live in landed properties in this area. One of the most popular is the 3 storey terrace/villas Permai Garden Residences, one of the latest projects with gated landed properties managed by Alila.
There are also two international schools in Tanjung Bungah, Dalat International School and Tenby International School. Another upcoming International school is the Prince of Wales International School.
Most MM2H holders and expats who choose to live Batu Ferringhi are European, British and Korean.
Some of the most popular condos are Miami Green Resort, Seaview Garden and Island Resort, while popular landed properties include Moonlight Bay Resort and Shamrock Beach.
With only around a 10-minute drive away, you’ll reach the Upland International School. Therefore, these are highly popular among families with primary and secondary children. The newest projects near Batu Ferringhi town are Bayu Ferringhi Condominium and Ferringhi Residence.
Just keep in mind that the demand for rental units decreases in this area as people have started moving to Tanjung Bungah and Tanjung Tokong, where there are new options available.
Gelugor and Bayan Lepas are preferable among MM2H-holders, retirees, and expats for several reasons.
First of all, these areas have seen a lower influx of foreigners and offer a more genuine local lifestyle. It’s also a preferable choice among expats that work in multinational companies in Bayan Lepas or on the mainland, as they can reach these areas within a short distance.
Rents and property prices are lower as well, making it a suitable place for foreigners that work from home and having a smaller budget.
There is also a reason why we see increasingly more newly completed projects in the Southern parts of the island, attracting more people from the above category.
Below I’ve listed popular condos in different areas located in the southern parts of Penang island.
Rental values in Bayan Lepas are relatively low compared to the Northern parts of the island, that’s busier with foreigners. Monthly rents range between RM 2000 ~ 5000. You can enjoy a beautiful 3 – 4 bedroom unit that’s fully furnished, and with sea view or hill view, at this price level.
Malaysia attracts many foreigners that wish to either settle down or have a property as a getaway retreat. The region as a whole has several locations that attract foreigners for various reasons.
Penang has warm tropical weather which is highly appreciated among foreigners that come from cold countries. They can escape their country during the winter months and enjoy all the lovely sea views and beaches that Penang has to offer
Penang is famously known for being more relaxed and for having a genuinely lovely and friendly community. The warm welcome of local islanders attracts foreigners interests, and to engage with the locals, in addition to finding their international community of friends.
Penang is very accessible as there are many cheap travel options, foreigners can reach their home countries with direct international flights.
Penang is like a melting pot of diverse cultures and with a fusion where “East meets West”. There’s a wide variety of food options, Penang is famous for having some of the best foods in Asia.
There’s an affordable cost of living; you can stretch your pension budget or savings and still live a comfortable lifestyle. Families with young children can enjoy low-cost education fees with high quality and standards.
Georgetown has been listed as a UNESCO World heritage, the architecture and culture of Penang are preserved for a long time back. It fascinates and attracts many foreigners interests, as they can live a modern life with strong cultural presence just around the corner.
Penang is safe – crime rates are lower compared to other Asian countries and cities like KL, Manila, and more.
Deciding whether you should buy or rent is not always an easy task. Renting is more convenient and brings less responsibility. At the same time, you might miss out on future price appreciations of the property.
The feeling of owning a property is also unique in itself.
However, one of the key points that speak for renting as the best option in Penang is that rents are very budget-friendly. Malaysia has introduced minimum investment requirements towards foreigners as well; these are among the highest in Penang where you need to pay at least RM 3 million for a villa on the island.
Overall, we see that many foreigners decide to rent a property for various reasons. Below I’ve covered three of the main reasons why we continue to see this trend.
Foreigners want flexibility.
Many foreigners have adopted a “Wait and see” strategy and preferably rent units instead of buying. Either they plan to buy at a later stage or keep on renting, waiting for the market to recover. By renting a unit, you have more flexibility and can decide when to switch location, or to leave.
High investment requirements and better investment options.
As mentioned above, Penang has high investment requirements, as of 2018, you need to pay at least RM 3 million (USD 722,000) for a landed house on the island. The limit is set to RM 1 million (USD 240,000) for strata-title properties, like condominiums, and is still considerably high.
Having the option to rent a spacious and modern place for RM 5000 (USD 1200) a month, instead of locking in a big sum of money in an illiquid asset that won’t appreciate much in the coming years, many foreigners decide to rent property instead.
A weak local currency still attracts foreign buyers.
Malaysia’s local currency, Ringgit (RM), has depreciated much over the years, making Penang attractive for foreign real estate buyers. Buying in 2018, with the current exchange rate, is at the same status quo to purchasing a property 4-5 years ago. Malaysia also offers the MM2H visa, which is renewable and gives you the right to stay for 10 years at a time. With cheap living costs, medical care (with high standard), and high quality of life in general, keeping a property for more than 5 years is easy for many.
Penang has received a large share of foreign retirees and expats over the years. It will probably increase over the years as this coastal pearl gains more attention in media.
Renting is still a preferred option in Penang as the island is comparatively expensive to other cities in Malaysia. Besides, the investment requirements are quite significant as you need to put up at least RM 3 million when buying a villa, which equals to around USD 700,000.
Rents are very low in comparison, and there are many units available in a number of modern condos.
Source: IQI Global Blog