Can Malaysia My Second Home (MM2H) Recover Its Lost Ground?

Lifestyle migration is on the rise. Some warmer climate countries with lower living costs, especially in Southeast Asia, Latin America and Southern Europe, have introduced lifestyle migration visa programmes for people seeking to retire, to invest in property or a second home, or to live as a digital nomad. Malaysia has been in the retirement and second home migration market for four decades. It is particularly known for the Malaysia My Second Home Programme (MM2H) established in 2002. However, major disruptions and changes to the MM2H since 2018 have impacted its attractiveness and credibility.

The MM2H is a long-term, renewable multiple-entry social visit pass allowing the participant and their dependents to reside in Malaysia. It was rebranded in 2002 from its predecessor, the Silver Hair Programme (SHP) established in 1987 under the purview of Malaysia’s Immigration Department. From 2002 to 2019, the MM2H underwent a period of growth, especially from 2006, when it was transferred to the Ministry of Tourism, Arts and Culture’s (MOTAC) management (Figure 1). During this period, there were 48,471 MM2H participants, with the top three origin countries being China (32.8 per cent), Japan (10.6 per cent), and Bangladesh (8.9 per cent). Various economic activities emerged to service MM2H participants’ needs, including visa application and renewal services, banking and finance, real estate, education, healthcare, lifestyle amenities, and tourism.

From 2002-2019, the MM2H contributed an estimated US$13. billion (RM1=US$0.24) to the Malaysian economy through property investment, medical and education expenses, and other economic multiplier effects. Its popularity led to its recognition as one of the world’s top lifestyle and retirement visa programmes in the late-2010s.  

Figure 1: MM2H timeline

However, from 2018 to 2023, a period that overlapped with the Covid-19 pandemic and a series of four changes of Malaysia’s federal government, the MM2H was subjected to successive disruptions and programmatic changes. These included periods of suspension while it underwent a review, and an abnormally high rejection rate of 90 per cent. The disruptions were partially attributed to conflicting claims of MM2H jurisdiction between the Ministry of Home Affairs (MoHA) and MOTAC. The tussle led to a series of changes to the MM2H during 2021-2023, confusing industry players, MM2H participants, and prospective applicants.

In 2021, MoHA announced ten new conditions accompanying the relaunched and “enhanced” MM2H (eMM2H). These included a fourfold increase in monthly offshore income (from US$2,400 to US$9,600), a much higher fixed deposit amount (US$240,000), proof of liquid assets (US$360,000), a new residential requirement (90 days annually), and a US$1,200 processing fee. The more stringent eMM2H was not well received: during its first ten months, it had only 267 applications, while 1,461 existing participants withdrew from the MM2H.

In 2022, MoHA launched the Premium Visa Programme (PVIP) targeting wealthy foreigners. But the hefty US$48,000 processing fee and mandatory US$4,800 agency deposit per applicant contributed to a dismal take-up rate. By December 2023, only 57 PVIP applications were processed.

The flip-flopping changes to the MM2H from late-2018 to the present caused confusion and impacted the attractiveness of Malaysia and the programme.

In 2024, MOTAC introduced a “revitalised” or “revamped” three-tier MM2H (Silver, Gold, and Platinum) and a Special Economic Zone/Special Financial Zone MM2H (SEZ/SFZ MM2H) (Table 1). Some financial requirements were relaxed: the monthly income and liquid asset requirements were removed, and the minimum fixed deposit amount was lowered. Policy communications initially signalled that Platinum participants would be eligible for permanent residence status, but this opportunity did not materialise. Instead, a new requirement was added: MM2H participants must purchase a property in Malaysia worth between US$144,000 and US$480,000 (depending on their visa tiers) and hold it for at least ten years. While some industry players agree that this could help resolve property overhang, others highlight that it may be a deterrent to prospective applicants and lead to dwindling numbers.

Table 1: “Revamped” Malaysia My Second Home Programme, 2024

* Applicable to the Johor–Singapore Special Economic Zone (JS-SEZ) and the Forest City Special Financial Zone (SFZ)

Amidst the MM2H’s disruptions and changes, equivalent programmes in the region have become comparatively more attractive. Thailand relaxed various criteria of its Long-Term Resident Visa, including removing the annual personal income (wealthy global citizens category) and minimum work experience (highly-skilled and work-from-Thailand professionals categories) requirements. Indonesia’s Golden Visa allows applicants to either place a fixed deposit of US$132,000 or purchase property of the same value, thus eliminating the MM2H’s dual requirement. The Philippines’ Special Resident Retiree’s Visa requires either visa deposits of US$10,000 or US$20,000, or monthly pensions of US$800 or US$1,000 – financial requirements that are significantly lower than the “revamped” MM2H’s.

The flip-flopping changes to the MM2H from late-2018 to the present caused confusion and impacted the attractiveness of Malaysia and the programme. Indeed, disruptions to the MM2H during 2020-2023 led to an estimated US$2.16 billion loss to the local economy. The onerous changes and piecemeal release of information have also affected MM2H agents’ businesses and their capacity to provide informed advice to their clients. Malaysia must provide clear and consistent direction, and enhance transparency and stakeholder engagement to ensure that future changes to the MM2H programme respond to market needs.

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