Johor's billion-ringgit property market braces for higher foreign buyer tax
[KUALA LUMPUR] Johor's property market is recording a spike in activity as foreign buyers scramble to close deals just weeks before a planned hike in levies kicks in.
The short notice given for the hike, announced on Jun 18, has sparked some disgruntlement, especially among Singaporean investors who say they have been left with little time to make big-ticket decisions.
Veteran agent Matt Tian from PropNex Malaysia said his team has fielded numerous complaints from potential buyers, particularly Singaporeans, who are upset with the short notice. 'Many feel forced into making quick decisions or face higher costs,' he said.
'We have also heard concerns from buyers in Taiwan, China and Indonesia.'
Effective Jul 1, Johor will raise the levy on foreign property purchases to 3 per cent or a minimum of RM30,000 (S$9,060), up from 2 per cent or RM20,000. The new rates will not apply to sale-and-purchase agreements signed before the deadline.
While some buyers are adopting a wait-and-see stance, real estate professionals say interest in Johor remains resilient. Tian noted that even with the higher levy, Johor properties still offer better value than those in the Klang Valley, Penang or the buyers' home countries.
A NEWSLETTER FOR YOU
Friday, 8.30 am Asean Business
Business insights centering on South-east Asia's fast-growing economies.
Sign Up
Sign Up
For comparison, a two-bedroom, two-bathroom condominium near the Johor Bahru Custom, Immigration and Quarantine complex is priced at around RM750,000 or RM884 per sq foot (psf). A similar unit in central Kuala Lumpur near the Petronas Twin Towers is being listed at RM1.45 million or RM1,272 psf, according to PropertyGuru.
Other industry stakeholders also believe that the higher levy will not deter foreign interest, given the anticipated economic boost from the Johor-Singapore Special Economic Zone (JS-SEZ).
Lindy Tan, who chairs the Real Estate and Housing Developers' Association (Rehda) Johor, said developers are already fielding heightened interest from buyers looking to beat the July deadline.
'Many have expressed their intention to finalise deals quickly, though it's too early to quantify,' she told The Business Times. She added that this could pull forward demand and slow sales in the following quarter.
Tick tock on the levy clock
Announcing the changes on Jun 18, Johor Chief Minister Onn Hafiz Ghazi said this marks the first levy revision since 2004 and it is aimed to offset rising operational costs and improve service delivery for investors and the public.
The proposal also raises land transfer registration fees for properties priced above RM500,000, with an extra RM500 charged for every RM100,000 thereafter. This measure also includes industrial property purchases by foreign buyers or companies.
For example, a RM1.5 million property would now incur a RM45,000 foreign buyer levy and a RM5,000 registration fee. This brings total transaction costs to RM50,000, up from RM30,000 previously.
Effective July 1, the levy on industrial properties will also double from 2 to 4 per cent, on top of the existing 4 per cent stamp duty.
Once home to Malaysia's highest number of overhang properties, Johor has seen improvement since the resuming of cross-border travel with Singapore in 2022 after the Covid-19 restrictions were lifted.
In Q1 2025, the state recorded 3,034 overhang units – down from Kuala Lumpur's 3,668 units. In 2022, Johor led the nation with 5,992 overhang units.
Johor recorded 15,094 property transactions worth over RM11.1 billion in the first quarter of 2025, down from 18,106 transactions and RM14.6 billion in Q4 2024. This marks a 17 per cent drop in transaction volume and a 24 per cent decline in value.
Residential properties made up the bulk of activity, accounting for 64 per cent or 9,646 transactions worth over RM5 billion. Commercial deals comprised 15 per cent, with a total value of around RM2.2 billion.
Catalysts
The RTS is seen as a major game changer for Johor's cross-border appeal. PHOTO: BT FILE
Investor optimism has been buoyed by the progress of the JS-SEZ and the ongoing construction of the Johor Bahru–Singapore Rapid Transit System (RTS), set to begin operations by December 2026.
The 4 km high-volume shuttle will transport up to 10,000 passengers per hour in each direction between Bukit Chagar in Johor and Woodlands North in Singapore.
The Causeway – among the world's busiest land border crossings – currently sees about 350,000 daily commuters, often with hours-long wait times. The RTS is seen as a major game changer for Johor's cross-border appeal.
'Properties near the RTS station are selling like hotcakes,' said Samuel Tan, founder and CEO of Olive Tree Property Consultants. 'Prices have surged from RM800 to RM1,200 per square feet (psf), and commercial land prices have more than doubled from RM700 to around RM1,500 psf.'
Industrial property demand is also rising. Rehda's Lindy Tan said areas such as Senai, Kulai and Sedenak are attracting investor attention, supported by the JS-SEZ.
Senai and Kulai are well-known logistics hubs in Johor due to their proximity to Senai International Airport, while Sedenak has emerged as a popular destination for data centres, attracting several multinational corporations such as Yondr Group, Keppel, and ByteDance's Bridge Data Centres.
From January to March 2025, Johor concluded 353 industrial property deals worth RM1.9 billion. For the full year 2024, the state recorded 1,592 such transactions valued at over RM6.6 billion.
Spanning over 3,500 sq metre – nearly four times the size of Singapore – the JS-SEZ targets 11 key sectors including manufacturing, logistics and energy. Plans are underway to expand 50 projects in five years and 100 within a decade, potentially creating 20,000 skilled jobs.
On June 23, Onn Hafiz said Johor aims to attract RM100 billion in investments by end-2025, having already secured RM30.1 billion in the first quarter alone.
The Causeway, among the world's busiest land border crossings, currently sees about 350,000 daily commuters, often with hours-long wait times. PHOTO: BT FILE
Tian noted that the RTS appeals to Malaysians working in Singapore and to Singaporeans seeking a more affordable and laid-back lifestyle.
Samuel Tan added that other catalytic projects, including the electrified double-tracking rail, Forest City's Special Financial Zone, and a potential revival of the Kuala Lumpur-Singapore High-Speed Rail, are also driving optimism.
'Johor's property market is at a pivotal point,' he said. 'Any increase in fees, especially targeting foreign investors, must be handled with care.'
Samuel Tan urged the state to consider delaying the levy implementation until the JS-SEZ and Forest City Special Financial Zone gain more traction. 'To increase a higher tax rate and additional charges in such as a short notice, may give the impression that the authorities are cashing in on improving sentiment,' he said.
'Instead of front-loading the cost burden, the state can generate revenue through property taxes and quit rent, while welcoming job-creating investments,' Tan said. 'The timing and scale of the hike need a serious rethink.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
2 hours ago
- Straits Times
Surviving terror, investing in hope: How entrepreneur Shiv Puri turned survival into purpose and prosperity
Mr Shiv Puri, a philanthropist and the founder and managing director of TVF Capital Advisors, at Sentosa Golf Club on June 23, 2025. ST PHOTO: GAVIN FOO Wong Kim Hoh meets... Surviving terror, investing in hope: How entrepreneur Shiv Puri turned survival into purpose and prosperity Meet Mr Shiv Puri and you might think he has breezed through life, helped along by luck and a few well-timed tailwinds. The 48-year-old entrepreneur and philanthropist laughs easily, tells great stories and carries the steady calm of someone who has seen the extremes of human experience and lived to tell the tale. Behind the easy charm is a mind forged by discipline – on the golf course, where he was a teenage amateur champion; in the boardroom, as founder of boutique equity firm TVF Capital Advisors; and most profoundly, in the face of mortality, having survived the 2008 Mumbai terror attacks. The last experience reshaped his outlook and brought a deeper purpose to his pursuit of success. Now a Singaporean, Mr Puri was born in Mumbai but moved to New Delhi when he was a child. His entrepreneur father, who left a stable job to start a real estate business, and his mother, a homemaker, raised him and his older sister in what he describes as a 'very normal upbringing'. But normal is relative. Even as a child, he was 'very driven to want to do something on my own'. At 11, he started his first business: buying cricket cards wholesale and selling them to classmates, undercutting the vendor outside his school. The profits, he recalls, were 'great money for a kid', enough to supplement his meagre pocket money and fund fast-food treats. Around the same age, he discovered golf. His father had joined a club, and young Shiv tagged along, quickly becoming hooked. 'Golf is a mental sport. It's all in the mind,' he says. By 15, he was playing internationally, and at 17, he represented India at the World Schools Golf Championship in St Andrews, Scotland, the sport's hallowed ground and the oldest golf course in the world. Golf, he explains, is less about beating others and more about 'competing against the course'. It taught him resilience. He says: 'If you hit a bad shot, it's over, it's behind you... don't dwell on the past. You can still regroup and have a good round.' These lessons – patience, focus and the ability to recover from setbacks – would later become the bedrock of his investment philosophy. When it came time for university, he set his sights on the United States, a bold move in the mid-1990s, when few in his family had ventured so far. His parents agreed, on one condition: He would study engineering. 'I had no idea about engineering, but I said yes,' he says. At the University of Pennsylvania, he went a step further, landing a spot at the prestigious Wharton School and juggling a dual degree in systems engineering and finance. 'I had to do the engineering degree to make mum and dad happy,' he says with a laugh. It was at Wharton that he stumbled upon the writings of Warren Buffett and Charlie Munger, the minds behind American multinational conglomerate Berkshire Hathaway. Their no-nonsense wisdom and long-term investing philosophy struck a chord and would go on to deeply shape his world view. To save on tuition, he crammed five years of coursework into four. Despite the punishing schedule – 'in my final semester, my friends were taking two classes... I had seven, plus golf' – he thrived. Playing off a handicap of one, Mr Puri was part of the team that led Penn to its first Ivy League championship in 66 years. By the time he graduated in 1998, one thing was clear: Engineering had sharpened his problem-solving skills, but his heart was in finance. He landed his first job at investment bank Morgan Stanley in New York, working in private equity, ironically, in real estate. 'My dad was very happy,' he says. The hours were brutal, the learning curve steep, but the experience invaluable. Yet, after two years, he craved more than just 'crunching numbers and thinking about Excel sheets'. The lure of Silicon Valley – and the boom – proved irresistible. He joined Crescendo, a venture capital firm, just as the tech bubble was inflating. 'We'd make investments, and the value would shoot up 30 times in a year. I thought, 'Making money is so easy!'' he recalls, with a wry smile. After the bust, Mr Shiv Puri realised that venture capital – picking winners from a sea of business plans – was not where his edge lay. ST PHOTO: GAVIN FOO Then came the crash. 'In one year, I saw people I thought were the best investors lose everything. That was the single best risk management lesson I've ever had. No textbook could teach me that.' 'Even today, when there are market bubbles or exuberance, that risk filter subconsciously is always there,' he adds. After the bust, Mr Puri realised that venture capital – picking winners from a sea of business plans – was not where his edge lay. In 2001, he joined Bain Capital in Boston, this time focusing on public equities. 'Six months into the job, I knew this was what I wanted to do forever,' he says. The appeal? The ability to analyse established businesses, look beyond short-term noise and invest with a long horizon. But the entrepreneurial itch returned. In 2004, Mr Puri launched his own fund, TVF (The Voyager Fund), with a modest pool of capital of US$5 million and a simple philosophy inspired by Mr Buffett and Mr Munger: 'Play long-term games with long-term people.' He sought investors who were willing to commit for years, and focused on businesses he could hold for a decade or more. 'Compounding is everything,' he says. 'All good things happen because of compounding, whether it's wealth, health, family or relationships.' The approach was unusual in the world of public markets, where most investors chase quick returns. Asked how a 27-year-old resisted the allure of fast money, he says: 'There's a lot of noise and turbulence when you're flying at a certain level but if you fly slightly higher, it's actually calmer. And you can see the horizon better.' Mr Shiv Puri with the late Mr Charles Munger, vice-chairman of American multinational conglomerate Berkshire Hathaway, in 2019. PHOTO: COURTESY OF SHIV PURI Word spread. Institutional investors – family offices, college endowments, even a sovereign wealth fund – came knocking. Today, the company manages more than 150 times its original capital, with a team split between Singapore and India. TVF's approach is resolutely bottom-up, focused on sectors like financial services, healthcare (especially hospitals), technology and consumer discretionary, particularly in India and South-east Asia. Key investments which the company has held for more than a decade include Max Healthcare, a major player in India's healthcare sector; Info Edge, an early-stage tech company that grew into a big online classifieds business; and Bajaj Finance, a non-banking financial company with a market capitalisation that has gone from US$3 billion in 2015 to US$65 billion (S$83 billion) today. 'We look for businesses that can scale, maintain quality and have a long runway for growth,' he says. 'Patience is active, very active endurance, knowing that there's a goal, knowing that you're making progress but it's not immediate,' he says sagely. He insists on getting to know founders deeply, sometimes over decades, before investing. 'It's not just about the person at the top, but the culture within the firm,' he says. If golf taught him patience, and the crash taught him risk, it was the Mumbai terror attacks of 2008 that taught him perspective. On the night of Nov 26 that year, Mr Puri, his wife and two friends were having pre-dinner aperitifs at the Taj Mahal Palace hotel's Harbour Bar when gunfire erupted. 'At first, we thought someone had dropped a lot of plates,' he recalls. But the reality soon became clear. Drawing on his knowledge of the hotel's layout – he got married there a year earlier – he led his group through kitchens and corridors, seeking refuge. They hid in the chef's office, lights off, chairs braced against the door, as terrorists stalked the hallways. At one point, he heard a terrorist outside the door asking a hotel employee if there were guests inside. 'At that point, the terrorists were not shooting the servers, waiters or chefs unless they came in the line of fire. They wanted to shoot the guests, the foreigners, people who would make headlines. Luckily, the employee said there was no one inside.' Later, a heroic chef – who unfortunately died in the course of the night – led them to a business lounge packed with 150 people. When an evacuation was attempted, the first 30 people in line were gunned down. Mr Puri and his wife and friends were just four places behind. 'It was pure luck,' he says quietly. They spent the night lying flat on the floor, frozen as gunfire echoed around them, until commandos finally rescued them at dawn. 'I always had an innate belief that it was going to be okay,' he says. His wife, meanwhile, could think only of their five-week-old baby at home. After the incident, she struggled to leave the house for months, but Mr Puri went back to work two days later. The experience was transformative. 'After that, nothing in business, no market crisis, could come close. It put everything in perspective.' His brush with death was a turning point, he says. 'I became much more deliberate about purpose. Wealth creation has to have a purpose. For me, that's making an impact, especially in education and healthcare,' says Mr Puri, who also set up his own family office, Vesta Global Capital, in 2015. Over time, he channelled his energies into philanthropy, especially in education. 'Education can really change lives. It's the best form of pay-it-forward,' says Mr Puri, who, among other things, helped scale Prayas, a non-governmental organisation that runs after-school programmes for disadvantaged children in Delhi, and co-founded Ashoka University, now India's largest liberal arts institution. His involvement goes beyond funding. He is actively building bridges between Ashoka and the National University of Singapore (NUS), fostering student exchanges and entrepreneurial internships. In Singapore, where he moved to after the Mumbai attacks, he also sits on the international advisory council of the NUS Yong Loo Lin School of Medicine, mentoring young doctors and entrepreneurs. Mr Shiv Puri planting a tree in 2016 at Ashoka University, which he co-founded. PHOTO: COURTESY OF SHIV PURI Healthcare, particularly eldercare, is his next frontier. 'How do you age gracefully? It's about finding purpose, getting respect and still feeling like you're a valuable member of society even though you're not working. It's a combination of all these things,' he says. For insights into long-term thinking, he studies Mr Buffett's annual letters. For perspective, he turns to Roman emperor Marcus Aurelius' Meditations, a collection of writings on Stoic philosophy. Among other things, Stoic philosophy focuses on staying grounded, resilient and at peace by focusing on what you can control and letting go of what you can't. Despite the constant drumbeat of bad news and global woes, the father of two teenagers prefers to remain optimistic. 'Civilisation requires trust. I think optimism is a default setting. It doesn't mean you're being naive. But I think people are far too pessimistic, especially in the investing world.' He adds: 'Human ingenuity cannot be underestimated. And despite all we have endured in the past, we are still living in the most prosperous time on earth.' Join ST's WhatsApp Channel and get the latest news and must-reads.
AsiaOne
17 hours ago
- AsiaOne
Eye care giant Alcon keeps 'lens' on the future with expanded manufacturing and logistics facility in Tuas, Singapore News
Eye care-device giant Alcon officially opened its expanded state-of-the art manufacturing and logistics facility in Tuas Biomedical Park on Friday (June 27) morning. This brings Alcon's investments in Singapore to more than US$600 million (S$765 million) since it began operations in Singapore back in 2005. The completed Tuas facility is one of the Swiss-American firm's largest high-tech manufacturing sites with Industry 4.0 capabilities, advanced automation and smart manufacturing systems to meet the increasing global demand for its contact lenses. Amid a growing middle class and rising demand for quality healthcare, the Asia-Pacific region continues to be the fastest-growing market for medical technology, with its market value projected to reach nearly S$300 billion by 2030. This puts the region second only to the US as a source of demand for medical technology (Medtech). "Singapore is home to some of the world's best-in-class Medtech manufacturing palnts. The sector has been growing steadily, with a manufacturing output of S$19.4 billion in 2023. This marks a $5.2 billion increase over the past decade," said Senior Minister of State for Trade and Industry Low Yen Ling at the opening ceremony of Alcon's expanded facility. Beyond strengthening innovation and supply chain resilience within Singapore's MedTech ecosystem, Alcon's investment is also expected to benefit Singaporean workers and small- and medium-sized enterprises (SMEs) in Singapore. Muhammad Haiqal Bin Sapuan, an associate supervisor at Alcon made the switch from the oil and gas industry, through the Career Conversion Programme (CCP), in 2022 to have more time with his family. A year and a half into his role as a senior technician, he was nominated by his peers to step up as an associate supervisor. [[nid:707984]] "That recognition gave me confidence. I started off as an interim, and it was tough at first, but the team's support made the difference," said Haiqal. To date, nearly 180 Singaporean workers have benefitted from the CCP to become Alcon associates. Alcon's new facility is expected to create new job opportunities in production operations, quality control and supply chain management. It is also expected to strengthen innovation and supply chain resilience within Singapore's Medtech ecosystem through initiatives such as the Partnership for Capability Transformation, which partners local SMEs to buiild capabilities from precision moulding to packaging, helping them to scale and compete globally. [[nid:715407]] editor@
Straits Times
19 hours ago
- Straits Times
How letter in CPIB mailbox exposed case with 89 bribe recipients linked to waterproofing firm
Mr Phua Meng Geh, deputy director at the enterprise projects office at CPIB, said this case highlighted Singapore's intolerance against corruption. ST PHOTO: TARYN NG How letter in CPIB mailbox exposed case with 89 bribe recipients linked to waterproofing firm An anonymous tip-off in 2012 revealed a systemic practice of corruption embedded within a Singapore firm and the large number of people involved. Samuel Devaraj finds out how the Corrupt Practices Investigation Bureau cracked a case involving a company in the building and maintenance industry. SINGAPORE – In 2012, an anonymous letter landed in the mailbox outside the Corrupt Practices Investigation Bureau (CPIB) headquarters in Lengkok Bahru. The writer claimed there was an established practice of corruption in a company in the waterproofing and general works industry. Another letter arrived several months later with more information. CPIB officers investigated the claims and unravelled a web involving 89 people, including managing agents, contractors and property agents, who took money from the company documented in financial records as 'referral fees'. This is one of the highest numbers of bribe recipients in a corruption case in Singapore, said CPIB. At the centre was the company's director who adopted this practice so the recipients would be motivated to recommend his company for future work orders. Between January 2011 and February 2014, he offered bribes of about $461,600 to the 89 people. The individual amounts ranged between $100 and $19,000. In 2016, the then 43-year-old Singaporean director was sentenced to 30 months' jail after pleading guilty to 20 counts of corruption, with 517 other charges taken into consideration. CPIB's deputy director at the enterprise projects office, Mr Phua Meng Geh, was then heading the investigation unit assigned to the case. Speaking to The Straits Times on June 25 at CPIB headquarters, he said this case highlighted Singapore's intolerance against corruption, no matter the value of the bribe. Mr Phua, who has been with CPIB for 27 years, added: 'I think there is this thinking with many people that a lot of these (business) practices are a way of life. 'We are not saying you cannot give tokens of appreciation. What we are saying is if there is a corrupt favour attached to it, then that is where we need to take a very strong stance against it.' Of the 89, 21 were charged while the rest were given stern warnings. Eight of the 21 were given jail sentences of between four and 20 weeks. All 21 were fined between $9,000 and $40,000 and were ordered to pay penalties amounting to the gratification they received. Apart from the company director, six of the company's staff received jail terms of between four weeks and 13 months. Six others were handed fines of between $4,000 and $16,000. During court proceedings, it was revealed some employees were paid fixed salaries while others received commissions. For those on fixed salaries, the director would pass the 'referral fees' to them, and they would hand these to the clients. For those on commission, they had to contribute towards the clients' fees, to motivate these sales staff to secure the highest possible contract value. Mr Phua said after they were called up for investigations, some said the giving of the 'referral fees' was a business practice. He added while the full implications of their actions might not have dawned on them at the time, ignorance is no excuse under the law, especially for an act like corruption. He noted that the company director had said when the firm was small that the sums of money were given as a token of appreciation. Mr Phua said: 'When he first started out, his business wasn't that fantastic. He realised that by giving small tokens of appreciation, it helped his business a lot.' As his business grew to become one of the more established players in the waterproofing industry here, those receiving bribes demanded more money. When the director was arrested, Mr Phua said the man was relieved he would not need to continue paying the bribes. Following the case, Mr Phua said CPIB stepped up its anti-corruption educational efforts within the building and maintenance industry, and engaged the Association of Property and Facility Managers and Association of Strata Managers. Mr Phua reminded managing agents to have transparent dealings with contractors. For the business community, he said if they start offering such payments, then they will end up paying more and more until their business does not become viable. Highlighting the consequences of such practices, he added that the victims are home owners who may have to pay more after the inflated fees are paid by the Management Corporation Strata Titles. Added Mr Phua: 'If left unchecked, the managing agent who receives money would eventually become beholden to the contractors and could be forced to return the favour by bending rules or closing an eye here or there. 'Some of this may amount to safety breaches.' He cited the example of managing agents who need to ensure safety measures are in place for workers and residents when carrying out works involving the use of scaffolding. 'When they start deviating on some of these things in return for 'referral fees', the consequences can be severe,' said Mr Phua. The number of workplace deaths in Singapore rose from 36 in 2023 to 43 in 2024. One of the top causes was the collapse or breakdown of structures and equipment, said the Ministry of Manpower. Highlighting Singapore's zero-tolerance stance against corruption, Mr Vincent Lim, deputy director at CPIB, said it will take action against anyone for offering or receiving bribes. He added: 'Those who resort to corrupt means to get ahead in businesses will face the consequences under the law.' Join ST's WhatsApp Channel and get the latest news and must-reads.
