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This guide walks through how the HOC works, including the benefits and the types of property which are eligible.
Even with the HOC, buying a home is a big investment. And it can get even more costly if you need to send funds to Malaysia from overseas to pay for your new property. To help you get the best deal on international payments, we’ll also highlight Wise as a smart, cheap way to move your money across borders.
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Before we get started on the HOC let’s take a look at an example of the costs of sending payments abroad using Wise compared to a competitor - PayPal.
A cost example: Sending 20,000 USD from USA to a MYR account in Malaysia
As you can see with this example, sending money with Wise works out better value than using PayPal. Although PayPal has a low headline fee, their currency conversion costs are wrapped up in the exchange rate used.
When you’re sending an international payment, it’s crucial to check both the fees and the exchange rate available.
If you’re making a high value international payment towards your new property in Malaysia, you can make big savings by choosing the right payment provider.
Check out the secure, fast, low cost international payments available from Wise.
Send money with the mid-market rate🚀
The Home Ownership Campaign was originally planned to end in 2019. However, it has now been reintroduced from 1 June 2020 through to 31 May 2021.²
The Home Ownership Campaign is intended to make it easier for Malaysians to buy a residential property - and at the same time, reduce the number of extra housing units which are currently unoccupied. All Malaysian citizens can benefit from the HOC discounts, and can buy as many eligible properties as they wish. There are, however, fairly strict criteria about which properties are covered by HOC - more on that later.
Under the Home Ownership Campaign, eligible properties benefit from a discount of at least 10% from the developer, and may have stamp duty waived or reduced depending on the value of the property. Here’s what you need to know about stamp duty:²
Instruments of transfer:
Value of property | Normal stamp duty | HOC stamp duty |
---|---|---|
First MYR 100,000 | 1% | Exempt |
MYR 100,001 - MYR 500,000 | 2% | Exempt |
MYR 500,001 - MYR 1,000,000 | 3% | Exempt |
MYR 1,000,001 - MYR 2,500,000 | 4% | 3% |
Instruments on securing loan:
Loan amount | Normal stamp duty | HOC stamp duty |
---|---|---|
Up to MYR 2,500,000 | 0.5% | Exempt |
In order to be part of the HOC campaign, developers must offer a discount on the property cost of at least 10%. However, the discount can be higher than this, meaning you could save even more on some purchases. It’s worth noting, though, that not all properties will be covered by HOC. Developers might choose not to take part in the scheme, so you’ll need to check before proceeding with a purchase.
Let’s take a look at what the HOC means in practise, using an example of a home valued at MYR 450,000.
Without HOC:
Full cost of property | MYR 450,000 |
---|---|
Down payment (450,000 x 10%) | MYR 45,000 |
Stamp duty loan (450,000 x 0.5%) | MYR 2,250 |
Stamp duty MOT (100,000 x 1% + 350,000 x 2%) | MYR 8,000 |
Monthly Repayment (4.5% @ 30 years loan, 90% of purchase price)³ | MYR 2,052 |
Total | MYR 57,302 |
With HOC:
Discounted cost of property (450,000 x 90%) | MYR 405,000 |
---|---|
Down payment (405,000 x 90%) | MYR 40,500 |
Stamp duty loan (exempt) | MYR 0 |
Stamp duty MOT (exempt) | MYR 0 |
Monthly Repayment (4.5% @ 30 years loan, 90% of purchase price)³ | MYR 1,847 |
Total | MYR 42,347 |
In the case above, you could save around MYR 15,000. Not bad, right?
If you have been living or working overseas and hold funds abroad, you might need to use international transfers to pay for your new Malaysian property.
Cut the costs of sending and receiving international transfers with Wise.
You can send money to 70+ countries with low, transparent fees, using the mid-market exchange rate with no markup. Compared to Malaysian banks, it can be up to 4 x cheaper to send money abroad with Wise. Most likely much faster as well.
Moreover, you can receive money to a Wise multi-currency account from the UK, U.S., Australia, New Zealand and any Eurozone country, just as if you had a local bank account in those countries. Hold your money in 50+ different currencies, and switch it using the mid-market rate whenever you want to.
To send money with Wise,
And that is it! You can track your transfer in your account and your recipient will also be notified when a transfer reaches them.
Join 8 million customers and enjoy a cheaper, faster and transparent way to send money abroad with the “real” exchange rate.
To be eligible for the benefits of the HOC you must be a Malaysian citizen. ²
The properties covered by the HOC must be residential, including apartments, condos and landed houses. You can’t buy commercial buildings, and sales must be on the primary market to qualify, meaning you’ll have to be buying from a developer rather than a resale property.
There are a few other eligibility criteria to consider - here are the key points to know:²
You can find the full eligibility details online - check out the REHDA (Real Estate and Housing Developers’ Association) website for more information and a really useful FAQ section about the Home Ownership Campaign.²
Buying a home is never going to be cheap. But thanks to the HOC it is now more affordable to get onto the property ladde. If you’re sending money from overseas to make your property purchase, don’t forget to check out Wise.
Sources
*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.
This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
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