AROUND RM21 million (S$8.8 million) worth of Malaysian properties were sold in Singapore in October and November 2010 through a newly-opened sales gallery, said the chief executive of a government-led initiative to promote Malaysia as a real estate investment destination.
Malaysia Property Inc (MPI), a collaborative effort between the public and private sectors, opened an office-cum-sales gallery at SGX Centre 1 along Shenton Way last October.
The gallery provides space to Malaysian developers and government agencies that wish to promote their investments in Singapore.
In the first two months of the sales gallery's operation, some RM21 million worth of mainly residential homes were sold, said MPI chief executive Kumar Tharmalingam. Sales data for December is not available yet.
'The response has been very encouraging,' said Mr Kumar. 'Most of the buyers (around 90 per cent) are Singaporeans looking for either second homes or for properties for investment that they can rent out.'
About 80 per cent of the buyers picked up properties in Kuala Lumpur, Mr Kumar said.
According to him, completed condominium properties in Kuala Lumpur can get rental yields of around 5-6 per cent.
In addition, investors could also benefit from another 4-5 per cent appreciation in the capital value of their properties.
In addition to Kuala Lumpur, Penang and Johor's Iskandar area are also drawing interest from buyers in Singapore, Mr Kumar said.
In December 2010, more than a dozen homes in Johor were sold through the sales gallery.
Malaysia could appear to be a comfortable market for some investors as it does not have the highs and lows of Singapore's more volatile property sector, he added.
MPI was set up in 2008 as a joint venture between the Malaysian government's Economic Planning Unit and the private sector.