Investing Commentary

Property Dividends: Why Malaysian Housing Might Be the Best Place to Invest

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Property dividends are a less common way of companies paying their investors. In this form, investors are paid in assets rather than cash. These assets can come in various forms, but a common form is real estate.

Often, property dividends are used by a company when they don’t have enough cash on hand. Alternatively, property dividends might be used if a parent company doesn’t want to dilute its share position by distributing dividends of a traditional form.

Though property dividends aren’t an immediate cash-in-hand payout, property dividends still have a monetary value. You, as an investor, might want to think about seeking out investments that return property dividends because they can defer or reduce taxes on them. This is because you can hold onto these assets for a while before liquidating them.

But why look for companies offering property dividends in Malaysian real estate? The Malaysian housing market may be criticized as overly expensive by the average Malaysian, but in comparison to the US, Malaysian property appears cheap. International Citizens found that a house is 72% cheaper to rent in Kuala Lumpur than in North America, and buying is even cheaper than that. But the housing market is on the rise, meaning that you can receive affordable property of high quality and sell it for more later.

To understand why housing is cheaper right now in Malaysia, look at this PropertyGuru Group infographic on schemes for more affordable housing.

Infographic Design By: PropertyGuru Group

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