--- title: "Property vs Stock Investment Malaysia: Which Is Better? (2024)" description: "Dive into the nuances of property vs stock investing in Malaysia. Explore the pros, cons, and investment strategies to find out which is the best for you in 2024!" url: "https://www.mrmoneytv.com/articles/property-vs-stocks-investment-malaysia-which-is-better-2024/" category: "Property" author: "Finlit" published: 2023-08-22 updated: 2024-05-24 source: "Mr Money TV" --- # Property vs Stock Investment Malaysia: Which Is Better? (2024) Dive into the nuances of property vs stock investing in Malaysia. Explore the pros, cons, and investment strategies to find out which is the best for you in 2024! ## Key takeaways - Property hands you a tangible asset and rental income (Malaysia draws expats and international students to areas like Cyberjaya, KL and Selangor), but it's illiquid: selling can take weeks if not months. - Stocks are highly liquid, sellable almost instantly during market hours, and you can start with just a few thousand or even hundreds of ringgit while still diversifying across sectors, industries and regions. - With property you can buy through a mortgage, putting down a fraction of the price while still benefiting from its full appreciation over time. - Landlords in Malaysia can claim rental tax write-offs on assessment tax, quit rent, home loan interest, fire insurance premium, rent collection and renewal expenses, and repairs and maintenance. - The main property risks are oversupply (especially luxury KL condos), ongoing taxes, maintenance and insurance, and long periods of decline; stocks' risks are volatility, constant research, and emotionally driven impulsive decisions. - The author does both: one income stream is rental yield while he actively invests in local, global and crypto markets, on the principle of never putting all your eggs in one basket. In Malaysia, oftentimes, property and stocks stand out as the two predominant forms of investments. Both present unique advantages, risks, and strategies, making the choice between the two not-so-black and white. In this article, we’ll dive into the [world of property](https://www.mrmoneytv.com/post/which-is-better-landed-property-vs-high-rise-in-malaysia) and stock investing to provide a clearer picture of their differences and hopefully, it’ll help you make better informed decisions. Should You Invest In Property or Stocks in Malaysia? ## Property Investment in Malaysia ### Advantages of Property Investment: #### 1\. Tangible Asset Similar to global markets, Malaysian real estate, especially in prime areas like Kuala Lumpur, Penang, and Johor Bahru provides you with a tangible, physical asset. This offers both **utility** like living in it or renting it out and **security** where you can touch and see the property. #### 2\. Rental Yield Malaysia has become a hub for expatriates and international students, especially in places like Cyberjaya, Kuala Lumpur and Selangor. This provides you with the opportunity for **rental income**. This could either mean renting out the entire property or even individual rooms. #### 3\. Tax Benefits The Malaysian government has introduced various **tax benefits and deductions** for homeowners renting out their property as well as first-time home buyers. In terms of [**rental tax deduction**](https://www.propertyguru.com.my/property-guides/rental-income-exempted-income-tax-malaysia-11868), you can get write-offs on: - Assessment tax - Quit rent - Interest on home loan - Fire insurance premium - Expenses incurred on rent collection - Expenses incurred on rent renewal - Expenses on repairs and property maintenance On the other hand, according to [FMT](https://www.freemalaysiatoday.com/category/leisure/property/2022/05/14/understanding-real-estate-taxes-in-malaysia/), if you’re a first-home buyer of residential properties, you are **exempted from stamp duty** on the sale and purchase agreement (SPA) and l**oan agreement**s for residential properties priced **below RM500,000**. \*Do note that the exemption applies to Malaysian citizens on any SPA completed between Jan 1, 2021 and Dec 31, 2025. #### 4\. Leverage With real estate, you can buy a property with a **fraction of the price** down (through a mortgage) and benefit from the full **appreciation of its value over time**. The good thing is that financial institutions in Malaysia also often offer [**competitive mortgage rates**](https://ringgitplus.com/en/home-loan/), allowing you to leverage your investments with relatively low initial capital. ### Disadvantages of Property Investment: #### 1\. Market Oversupply Certain segments of real estate in Malaysia, especially luxury condos in Kuala Lumpur, have seen an **oversupply**, which might affect rental yields and resale values. Additionally, the property market can also go through **long periods of decline**, leaving you with assets worth less than their buying price. #### 2\. Maintenance Costs Owning property comes with **ongoing expenses** like taxes, maintenance, repairs, and insurance. This means you’ll need to ensure that you have **extra funds** to not only cover those expenses but any “emergency” costs that may arise. #### 3\. Illiquidity Real estate is **not as easily converted to cash** compared to stocks. Selling a property can take weeks if not months. So, when you decide to invest in property, you’ll need to keep in mind that this is a long-term investment. ## Stock Investing in Malaysia ### Advantages of Stocks Investment: #### 1\. Liquidity The appeal to stock investing is how “fast” you can profit from it. Stocks can be sold almost instantly during market hours, providing **access to cash quickly**. In that sense, stocks are pretty liquid assets. However, it’s worth noting that you’ll only want to do this if you have the knowledge and time to spare. #### 2\. Dividends In Malaysia, there are many established companies, especially those in **finance and utilities** that regularly offer dividends, providing shareholders with a **consistent income stream**. #### 3\. Diversification With stocks, diversifying your portfolio is simpler and a healthy practice to adopt when investing. You can invest in various sectors, industries, and regions with a **smaller amount of money**. #### 4\. Growth Potential Historically, the stock market has shown **significant growth** over long periods. ## Disadvantages of Stocks Investment: #### 1\. Market Volatility As with global markets, Malaysian stocks can be **volatile**, influenced by both domestic and international events. This could lead to **potential short-term losses** which is why understanding your financial goals, risk tolerance and investment horizon is important. #### 2\. Requires Research Effective stock investing often **requires regular monitoring, research, and understanding** of the market dynamics. So, before investing, it’s best that you pick up on some knowledge then along the way, you can continue learning even more so that you’re able to make better investment decisions. #### 3\. Emotional Factors The stock market's ups and downs can be **emotionally taxing**. And when there are emotions involved, it could potentially lead to making **impulsive investment decisions**. Maybe that’s why there are more and more [robo-advisors](https://www.mrmoneytv.com/post/mytheo-robo-advisor-review-malaysia) popping up these days? Anyway, what you need to understand is that the market’s volatility is normal and more often than not, the market bounces back after a dip. So, it’s important to stay disciplined on your financial goals when you’re investing in the stock market. ## Property vs. Stock Investing in Malaysia: Which Is Better For You? #### 1\. Initial Investment **Property**: In Malaysia, buying a property, especially in prime areas, requires **significant initial capital**. **Stocks**: In contrast, with just a **few thousand or even** [**hundreds of ringgits**](https://www.mrmoneytv.com/post/how-to-invest-rm100-every-month), one can start investing in a diverse portfolio of stocks. #### 2\. Market Knowledge **Property**: Understanding **property hotspots** like Bangsar, Desa Park City, or **emerging areas** in Shah Alam can be crucial for real estate. **Stocks**: For stocks, staying **updated with top-performing sectors**, whether in the local or global stock can be equally critical. #### 3\. Investment Period **Property**: Real estate in Malaysia, given the current oversupply in some segments, might require a **longer-term perspective**. **Stocks**: Depending on the strategy, can offer both **short-term trading and long-term holding** opportunities. ## My Personal Opinion on Property vs Stock Investing in Malaysia The decision between property vs stock investing in Malaysia hinges on **individual preferences, financial goals, and market knowledge**. For some, the allure of owning tangible property might be irresistible. Others might find the dynamic nature of the stock market more exciting and lucrative. Perhaps the ideal approach for you is a **balanced portfolio**, combining the stability and tangibility of **property** with the liquidity and growth potential of **stocks**. **Personally, I do a bit of both.** One of my [income streams is through rent yield](https://youtu.be/3SvYCt2ynS8) and I’m also a pretty active investor whether it’s in the local market, [global market](https://www.mrmoneytv.com/post/mplus-global-review-malaysia) or cryptocurrency. This is because I believe in the importance of **diversification**. In fact, I always advocate that you should never put all your eggs in one basket! However, whichever side of the fence you're on, at the end of the day, due diligence, continuous education, and sometimes even seeking advice from financial experts, remain key to successful investing in the Malaysian context. ***Subscribe to our*** [***financial newsletter***](https://www.mrmoneytv.com/) ***for the latest news, insights, and advice on personal finance, investing, and more. With every email, you’ll gather the confidence and knowledge to make informed decisions to achieve your financial goals.*** ## Frequently asked questions ### Is property or stocks a better investment in Malaysia? It depends on your goals, finances and market knowledge, so there's no single winner. Property gives you a tangible asset, rental income and the ability to buy with a mortgage, but it's illiquid and carries maintenance costs. Stocks are liquid, need less capital and diversify easily, though they're volatile and demand research. The article suggests a balanced portfolio combining both, and the author personally does exactly that. ### How much money do you need to start investing in stocks in Malaysia? You can start with just a few thousand or even hundreds of ringgit, according to the article, and still build a diverse portfolio across sectors, industries and regions. That is a sharp contrast with property, which, especially in prime areas, requires significant initial capital. So the entry cost for stocks is far lower than for property. ### What are the disadvantages of investing in property in Malaysia? Three main ones, per the article. Oversupply, especially luxury condos in Kuala Lumpur, can drag down rental yields and resale values, and the market can decline for long stretches, leaving assets worth less than you paid. Ongoing costs like taxes, maintenance, repairs and insurance add up. And property is illiquid, so selling can take weeks if not months. ### What tax benefits do property owners get in Malaysia? Two kinds, per the article. Homeowners renting out property can claim write-offs on assessment tax, quit rent, home loan interest, fire insurance premium, rent collection and renewal expenses, and repairs and maintenance. First-time buyers of residential property priced below RM500,000 are also exempt from stamp duty on the SPA and loan agreements, for Malaysian citizens on any SPA completed between Jan 1, 2021 and Dec 31, 2025. ### Why should I diversify between property and stocks? Because putting all your eggs in one basket is risky, as the article puts it. A balanced portfolio pairs property's stability and tangibility with stocks' liquidity and growth potential, so a downturn in one asset class doesn't sink everything. The author follows this himself, earning one income stream through rental yield while also actively investing in local, global and crypto markets.