It’s unclear whether the revisions will ultimately prove to be positive or negative, but the programme unquestionably looks different now.

The long-awaited relaunch of the Malaysia My Second Home (MM2H) visa has finally arrived with the release of the revised terms and conditions, although we are still awaiting the official start date. All existing agents and any company wishing to be a new agent must register with the ministry again. Agents’ existing licences do not allow them to assist in processing new applications.

The new conditions for agents are much tougher than before and will take most companies some time to comply. Among these conditions are a paid-up capital of at least RM200,000 while previously the requirement was RM80,000. They also require a RM200,000 bank guarantee. These measures are in response to some agents’ inability to refund clients, a situation exacerbated by the year-long suspension of the programme in 2020 and subsequent stringent new terms, which caused a significant drop in applications and a major loss of income for agents, leading many to experience financial difficulties.

Our sister company, an approved agent, has experienced minimal refunds over its 20 years of operation, with the total not exceeding RM200,000. Refunds typically occur when a client withdraws their application or if the application is denied. However, our agency experienced very few clients withdrawing their applications and our long experience with and understanding of the programme yielded an approval rate close to 100%, making refunds quite rare.

The visa seems no longer to be positioned strictly as a retirement visa, although it will still accommodate those wishing to retire in Malaysia. We had very much hoped they would tailor a visa for retirees, but it looks like they chose otherwise.

Here are the new rules for the MM2H programme which still leave many questions but gives the key requirements. We believe the property rules will be a major impediment to attracting large number of applications so we hope it is removed

The minimum age 35 to apply for the visa has been lowered to 25. It is clearly no longer primarily a retirement visa and is seeking to attract foreign investors. We had hoped they would carve out a retirement visa tailored to that audience but that has not happened,

There will be three tiers, Silver, Gold, and Platinum which have separate terms and conditions attached to each of them.

FINANCIAL REQUIREMENTS

Surprisingly, no minimum income has been set for new applicants of any tier. We were in favour of keeping it at RM10,000, but not setting any limit may cause problems.

The fixed deposit requirements have been stated in US dollars, which may mean the ringgit deposit will change based on exchange rates, which have been none to favourable to the ringgit in recent years. The deposit must be placed in a bank account in Malaysia. The amounts are stated as follows: Silver US$150,000; Gold US$500,000, and Platinum US$1 million. Previously the required deposits for this revision were stated in ringgit, which may yet end up being the required amount (RM500,000, RM2,000,000, and RM5,000,000). In the event they do fix on the USD figure, then the deposit required for the Silver tier will increase to over RM700,000, based on current rates.

There is a one-time ‘participation fee’ charged by the government for the principal applicants only which is RM1,000 for the Silver, rising to RM3,000 for Gold, and a whopping RM200,000 for Platinum. There is no charge for dependents.

PROPERTY MATTERS

All applicants are required to buy a house (the minimum value varies by tier), which they then cannot sell for 10 years. In our view, this requirement is certain to turn away many applicants. Although our research revealed over 60% of participants who relocated here purchased property, we predict many applicants will be unhappy they cannot sell it for at least 10 years particularly since the Silver tier is only given a five-year visa, albeit renewable. Participants are apparently permitted to change house for the same or higher value.

For some reason, they have specified the minimum property value each tier is required to buy. Silver tier must buy a property over RM600,000, Gold at least RM1 million, and Platinum at least RM2 million. This requirement will conflict with the limits set by some states for foreigners to buy property. The minimum purchase price for foreigners is set by each state and varies quite a bit. It is not clear which amount will take precedent, but we would think it is the state since they set property regulations. This whole property section leaves several questions unanswered like what happens if the person leaves the programme early and how soon after approval are they required to buy a house.

THE MULTIPLE-ENTRY VISA

The length of the visa varies, from five years for Silver, 15 years for Gold, and 20 years for Platinum. The visa itself will be multiple-entry, and issued based on the validity of the applicant’s passport. The maximum duration is five years, so the 15-year entitlement will actually mean three periods of five years, assuming the passport always has five years of validity. The advantage of the longer visa is that it is easier to get the extension of the visa in your passport rather than apply for a fresh visa.

Participants can bring their partner and biological children under the age of 21. Children over 21 up to the age of 34 have to be unmarried and not working. There is no age limit for disabled children.

It seems the Platinum visa allows the holder to work without seeking special permission. The rules for other tiers wishing to work have not been specified, but will certainly require them to seek approval.

One good development is that now dependent spouses will be able to assume the principal visa in the event of their death. Previously they were required to reapply in their own right which was problems for many of them.

POTENTIAL ISSUES

We see a few problems with the current revisions. The biggest groups of applicants for MM2H were people looking to retire here, along with a sizeable group that just wanted the visa as a potential escape route from their own country if it became necessary and never actually relocated here. The latter group usually came from countries experiencing domestic problems. Another sizeable group comprised parents bringing their children here for schooling. All these group still face problems with the current rules. We are also unclear on if or how this will affect existing MM2H visa holders. It is a pity the Ministry did not seek advice from the people who have been closely involved with promoting the visa for the last 20 years. 

We expect most MM2Hers will choose the Silver package, but we have two major caveats: We anticipate many potential applicants will be turned off by the size of the fixed deposit and especially the requirement to buy a house and hold onto it for 10 years. Older people will be reluctant to buy a house which they are not permitted to sell when they cannot confidently predict what the future may bring in terms of their health or financial resources.

We believe Malaysia is an exceptional country to live in, offering a vibrant and fulfilling lifestyle. One of the primary attractions is its relatively low cost of living. We think that visa regulations should align with these local realities and meet the expectations of potential residents, ensuring mutual benefit for both applicants and Malaysia. Unfortunately, the current changes in visa conditions appear to fall short of these goals, which we fear may diminish the programme’s former popularity.

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