KUALA LUMPUR (Feb 26) — The recent appreciation of the Malaysian ringgit is improving purchasing power for Malaysians investing in Australian real estate, according to insights from Knight Frank Malaysia.
For buyers financing property acquisitions with ringgit-based loans, the currency movement translates directly into lower capital commitments and reduced exchange rate risk.
As at Feb 25, the ringgit was trading around RM2.75 against the Australian dollar, strengthening considerably from RM3.18 in July 2024. For Malaysian investors, this shift means the same Australian property now requires substantially less ringgit capital than it did previously.
Jenny Neoh Channing, Associate Director of Australian Properties at Knight Frank Penang, noted that today’s exchange environment allows ringgit-based investors to secure overseas assets at a comparatively lower entry cost.
In practical terms, this currency advantage can equate to years of rental yield savings or reduced financing leverage — particularly for newly completed homes and land acquisitions where loan exposure to foreign exchange fluctuations is a concern.
Additionally, projections from Mitsubishi UFJ Financial Group (MUFG) suggest the ringgit may continue strengthening against major currencies through year-end, potentially reinforcing the buying window for overseas acquisitions.
Malaysia continues to rank among key foreign contributors to Australia’s residential land market. Data from the Australian Tax Office indicates Malaysian investors contributed A$111.6 million between July 2023 and June 2024, placing the country ninth among foreign sources of investment.
Strong bilateral ties, educational linkages, and long-standing migration patterns underpin this investment flow. According to the Australian Bureau of Statistics, Australia recorded 165,616 Malaysian-born residents in the 2021 Census.
Migration data further reinforces Australia’s demographic momentum. Between January and September 2025, net permanent and long-term arrivals reached 415,760 — the highest level ever recorded for that period, surpassing the previous record set in 2024.
Australia also hosted more than 13,000 Malaysian students in 2025, with the government targeting further growth in Southeast Asian enrolments for 2026.
From an investment standpoint, these demographic trends support sustained demand in both the owner-occupier and rental segments.
Australia’s rising population growth is directly supporting its build-to-rent (BTR) pipeline — a professionally managed residential asset class designed specifically for long-term leasing.
According to Knight Frank’s Australia Horizon Report 2026:
4,660 BTR units were delivered nationwide in 2024
Approximately 6,000 units are projected for completion in 2025
A further 4,000 units are forecast for 2026
Foreign capital into new dwellings has been concentrated in Victoria, New South Wales, and Queensland, with Melbourne and Sydney frequently ranking among the world’s most liveable cities.
Institutional investors are increasingly viewing BTR as a structural opportunity, driven by housing undersupply and sustained migration growth.
Despite favourable currency conditions, Malaysian investors must navigate a more complex regulatory framework when entering the Australian market.
Key considerations include:
A temporary ban (introduced in 2025) restricting foreign nationals from purchasing existing homes until 2027
Stricter oversight and higher application fees imposed by the Foreign Investment Review Board
Increased stamp duty surcharges on foreign buyers
A 15% withholding tax applicable to non-resident property transactions
Annual land tax obligations, often including absentee owner surcharges
While compliance requirements have intensified, Australia continues to appeal due to its economic stability, population growth, and rental demand resilience.
For investors based in Kuala Lumpur and Selangor, the stronger ringgit offers short-term offshore buying advantages. However, it also reinforces a broader strategic point:
Currency cycles change — but domestic industrial growth creates long-term structural value.
While some investors explore overseas diversification, Malaysia’s own industrial expansion — particularly across Selangor — continues to generate durable property fundamentals.
Demand for:
Industrial land in Selangor
Factory in Puchong
Industrial property in Subang area
Office space in Bukit Jalil
Commercial property in KL
is increasingly supported by semiconductor investment, logistics infrastructure upgrades, and digital economy growth.
Unlike overseas residential markets where investors face regulatory tightening and foreign ownership constraints, the Klang Valley offers clearer control, proximity advantages, and deeper operational insight for local investors.
In today’s environment, strategic capital allocation may not simply be about chasing currency gains abroad — it may also involve strengthening positions within Malaysia’s expanding industrial and commercial corridors, particularly in Selangor and Kuala Lumpur where infrastructure, talent, and connectivity continue to converge.
For property owners and investors focused on industrial and office assets in KL and Selangor, the fundamentals remain anchored by real economic activity — a factor that typically outlasts currency cycles.
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