Property Acquisition in Sarawak: A Guide for Foreigners

As a foreigner interested in Sarawak’s real estate market, one should be aware of the specific regulations, legal considerations and cultural nuances that come with property acquisition in this region. Thus, this article aims to provide a comprehensive guide for foreigners intending to acquire property in Sarawak, offering insights into the legal framework and specific conditions to be aware of.

1. Understanding the Legal Framework.

The relevant laws governing foreigners acquisition of properties in Sarawak can be found under section 13 of the Sarawak Land Code (Cap.81) and Land (Market Rate of Property for Foreign Acquisition) (Amendment) Direction 2019.

2. Who is classified as a “foreigner”?

As defined under the Sarawak Land Code, a foreigner is: -
a) any person who is not a Malaysian citizen and not permanently resident in Sarawak;
b) any foreign company, corporation, society, association or other body which is not registered in Malaysia under any written law applicable thereto; or
c) any person or body corporate which is a trustee under a trust any beneficiary of which is:
- a person who is not a Malaysian citizen and not permanently resident in Sarawak
- a foreign company, corporation, society, association or other body which is not registered in Malaysia under any written law applicable thereto

3. What kind of Properties cannot be owned by Foreigners?

- Residential properties categorized as low-cost and low-cost plus as determined by the State Authority
- Lands categorized as Native Land in Sarawak
- Properties reserved for sale to Bumiputera only
- Landed commercial properties
- Vacant lands without buildings

4. What kind of Properties can be owned by Foreigners?

- Any land with Special Development Area (Exemption from Prohibition of Foreign Interests)
- Any of the individual parcels within a building which has been sub-divided pursuant to the Strata Titles Ordinance 1995
- Any land with a building thereon for residential purpose and the market value of such land and building is not less than such amount as may be determined by the Minister by a direction published in the Gazette.

5. What is the minimum threshold property market value for foreign acquisition?

However, it is important to note that there is a certain threshold to be met before such foreign acquisition can take place. For example, if you are looking to purchase any of the properties listed under item 4, within the Kuching division the value shall not be less than RM600,000.00. If the property is in the other divisions of Sarawak, the market value then shall not be less than RM500,000.00.

Nonetheless, there is an exception to this where. the acquisition of both commercial and residential strata title properties in Sarawak by foreigners is not subject to any requirement of minimum market value and can be bought by the foreigners without any restrictions or limitations as highlighted earlier.

6. How much stamp duty may be imposed for foreigners?

All property purchases in here in Malaysia will be subject to payment of stamp duty once the Sale and Purchase Agreement (SPA) has been stamped. Based on the announcement of the nation’s Budget 2024, a flat rate stamp duty of 4% will be imposed on the instrument of transfer of property for foreigners, effective 1st January 2024.

Conclusion: The acquisition of properties in Sarawak as a foreigner requires specific regulations which may be amended from time to time. Should you have any further questions, speak to any of our legal professionals today at 082-241546 or drop us an email at conveyancing@galatomik.com.

Note: All information, content and materials made available on this page are strictly for general informational purposes only and does not constitute legal advice.