JOIN USRetirement homes in SE Asia
With Southeast Asian countries from Vietnam to Indonesia promoting themselves as ideal retirement destinations, the old and not-so-old are being courted vigorously by the region’s economic developers. This wooing also has created a niche market for real estate, from retirement villages in the Philippines to apartments and bungalows suitable for the elderly in Thailand and Malaysia.
“There are around 1,00,000 people across Asia who have retired to the region from elsewhere, but it’s really hard to say exactly,” said Andrew Ness, executive director of CBRE Research Asia in Hong Kong, a division of the CB Richard Ellis real estate agency. “Thailand is the big apple though, with everyone basically trying to pinch market share from there.”
Thailand among the first
Thailand was the first country in Southeast Asia to start courting retirees. “People came here backpacking in the 1960s and ’70s, then brought their kids in the ’80s and ’90s,” said James Pitchon, executive director of CBRE Thailand.
Junaida Lee, deputy secretary general of the Malaysian Tourism Ministry, said, “It’s the baby boomers we are targeting. They are top priority — those from the West, such as the UK and from Japan too.”
Home or Japanese retirees
Japanese retirees also have been pursued by the Philippines, where a $10 million retirement village is being planned for elderly Japanese on Tablas, an island in Romblon Province about 350 kms south of Manila. Sakura Retirement Investments of Japan announced the 40-villa project in October, last year saying it would be built by Smart Ventures, an Australian developer.
The complex is to include a Japanese restaurant, a private beach, a gym and sauna centre and its own security staff as well as a nurse assigned to each villa. Medical facilities are among the key factors in attracting retirees. “One reason why Phuket in Thailand has taken off as a place for retirement is that it has pretty good hospitals,” Ness of CBRE Research Asia said.
Malaysia programme
Malaysia says it has attracted about 12,700 participants since it started a retiree program called Silver Hair in 2002. It introduced Malaysia My Second Home in 2006. “Retirees and other long-stay residents spend much more than tourists,” Lee said. Participants are required to have minimum income levels, depending on their age. For example, anyone older than 50 years must have 350,000 ringgit or $104,000 in assets; a monthly pension of 10,000 ringgit, which may be deposited into Malaysian banks tax-free and must keep 150,000 ringgit in a fixed-interest account. A third of that deposit can be withdrawn after one year.
In exchange, participants get a 10-year resident’s visa and permission to work as many as 20 hours a week. They also gain the right to buy property, subject to state laws. And, while buying real estate is not mandatory, “Accommodation is very cheap in Malaysia,” said Steve Collins, a retiree from Enfield, a town in Middlesex north of London, who joined the Second Home program. “For £50,000 you can buy a very good home outside Kuala Lumpur.”
The housing stock in the suburb, which is popular with expatriates for its restaurants and golf courses, typically consists of low-rise condominium buildings constructed in the past 20 years, villas and semi-detached houses. Prices are typically about 700 to 800 ringgit a square foot. “I think the cost of living here is about one-third of what it is in the US or Japan,” said Toshiyuki Niwa, a Japanese-American who retired to Malaysia in 2007 after working for the United Nations for 37 years. “This is a definite plus,” he added.
Going Thai
In Thailand, the financial qualifications for the foreign retiree program are a deposit of 800,000 baht ($24,000) and a monthly income of 65,000 baht, regardless of age. Participants then receive a one-year visa, which can be renewed. Thai real estate laws state that only 49 per cent of the units in any apartment building may be owned by foreigners, regardless of whether they are members of the country’s retiree program. Although, foreigners are not permitted to own land.
Philippines, Vietnam...
In the Philippines, the Special Resident Retiree Visa Program is available to any foreigner 35 years or older. A deposit of $50,000 is required for anyone younger than 50 years; $20,000 for anyone older. Anyone accepted in the program gets permanent resident status and can deposit his pension in a Philippine bank tax-free. But the Philippines, too, bans foreign ownership of land.
Vietnam has also begun promoting retirement options, although, “Vietnam is a little immature as a market for this,” said Ness of CBRE Research Asia.
He explained, “Their resort property is mainly aimed at the Vietnamese themselves.” Looking at the region in general, “Malaysia offers a much more attractive legal package,” Pitchon of CBRE Thailand said.