KUALA LUMPUR, Aug 2 — With its balmy weather and endless array of food available near round-the-clock, South-east Asia has long been a popular destination with travellers from both the east and west wishing to call it home.

Malaysia introduced the Malaysia My Second Home (MM2H) programme in 2002 but came under recent backlash after some of its revamped rules that make it compulsory for the applicant to purchase a property in the country and hold it for 10 years.

Some agencies dealing in long-term resident visa applications for foreigners and prospective applicants have said the new conditions are not attractive enough and are giving them second thoughts.

Malay Mail takes a closer look at the three largest economies in South-east Asia and their respective long-term visa programmes to entice wealthy foreigners to buy local properties as a second home.

New in Malaysia’s visa residency scheme

The new guidelines, which received Cabinet approval in June, have relaxed some provisions from the 2021 version with reduced requirements for fixed deposits, offshore income and liquid assets.

But now, Putrajaya is making it mandatory for an applicant in Malaysia to purchase a property of a certain value and own it for a longer duration to spur growth in the high-end segment of the local property market.

This provision has since drawn criticism that it may no longer make the scheme as attractive as similar programmes offered by the neighbouring countries.

Thailand introduced its Long Term Residence (LTR) visa programme in September 2022, while Indonesia launched its Visa Second Home Programme in December 2022.

Investment requirements

All three programmes in Malaysia, Indonesia and Thailand are designed to attract wealthy foreigners with liquid cash.

Unlike the previous versions, the revised MM2H scheme has multiple tiers to cater to a wider range of foreigners, from young entrepreneurs to retired cash-rich individuals.

It now includes four categories: Silver, Gold, Platinum as well as Special Economic Zones (SEZ) and Special Financial Zones (SFZ).

The investment requirement is now in the form of fixed deposits starting from US$32,000 (RM151,000) and property purchases ranging from RM600,000 to RM2 million.

Based on the new scheme, the lowest investment value required for the applicant under the SEZ and SFZ categories would be RM151,000 in fixed deposit and a property or land purchase exclusively in special economic/financial zones.

Checks on online property listings show the cheapest property is in Forest City, Johor Baru.

The price tag in Malaysia is around RM340,000, which makes the total investment value for the 10-year visa less than RM500,000.

Following the property purchase, the applicant is allowed to withdraw up to 50 per cent of the fixed deposit amount for medical, education and tourism expenses while residing in Malaysia.

In comparison, Thailand’’s LTR visa was designed to only attract wealthy individuals holding at least US$1 million (RM4.71 million) in assets under the applicant’s name.

The criteria also include a minimum average personal income of US$80,000 (RM376,000) per annum in the past two years and requires combined investment in Thai government bonds or direct investment in companies registered in Thailand or property purchase of at least US$500,000 (RM2.355 million).

The Thai government, however, has also introduced the Thailand Privilege Programme to offer long-term multiple-entry visas to attract foreigners who opt to stay in Thailand for five to 20 years.

Applicants can sign up for the programme with a minimum of THB900,000 (RM115,623) and obtain a five-year residency visa with limited perks compared to the LTR programme.

Indonesia’s Visa Second Home Programme is more straightforward with applicants required to either deposit Rp2 billion (RM577,600) to state-owned banks, which cannot be withdrawn in any way while holding the residency visa or purchase a property of equivalent value to obtain the visa for five to 10 years.

Perks and visa duration

Apart from permission to live in Malaysia for long, the new MM2H programme comes with a wide range of perks, especially for top-tier categories with higher investment value.

The visa duration ranges between five to 20 years subject to renewal and allows applicants to obtain visas for their dependants such as their spouse, unmarried children below the age of 34, parents and parents-in-law.

Top Platinum visa holders are also allowed to conduct business or work in Malaysia throughout their residency.

In comparison, Indonesia’s Visa Second Home Programme also allows the spouse, children and parents to be the dependant of the principal visa holder.

The scheme, however, promises eligible applicants a pathway to permanent residency or citizenship in the country.

Unlike Malaysia’s MM2H, Indonesia’s programme doesn’t permit any of the visa holders to work as employees in the country.

Thailand’s LTR programme offers greater employment perks to the applicants, allowing them to legally work in domestically or in Thai companies without being considered a foreigner under the employee quota regulations.

The scheme also allows visa holders in the highly-skilled professional category to benefit from a flat income tax rate of 17 per cent.

Another notable difference between the programmes is that both Thailand and Indonesia do not impose minimum annual days of stay in the country, compared to 90 days of minimum stay imposed by MM2H.

However, applicants aged between 25 and 49 are allowed to fulfil this requirement as either principal or dependant.