Given the weakening exchange rate of the local currency during these times of low crude oil prices, Malaysians are looking at offshore investments in their efforts to diversify from ringgit-denominated assets.
Director of strategy and development of Crescent Wealth, Omar Khan, stated that offshore investment inflow from Malaysia and China into Australia, had increased significantly in recent years, mainly in the property segment.
He also revealed that Malaysia is the fourth-largest source country for approved Australian property investments, after China, the US and Canada.
The information was based on recent data from Australia’s Foreign Review Board.
Omar Khan was speaking at the launch of KAF Australian Islamic Property Fund (KAIPF), by Crescent Wealth, an Australian-based Islamic investment company, and KAF Investment Funds Bhd.
Deemed to be Malaysia’s first fund to give non-institutional investors direct access to Australian commercial property, it aims to deliver a 9% to 10% annual return to investors by targeting a 7% income yield and 2% to 3% in capital appreciation.
Crescent Wealth Malaysia’s head, Mas Johan Harris, highlighted that due to a shortage of office spaces in Australia, commercial properties are not subject to cooling measures introduced in the country.
On a side note, New South Wales’ capital city, Sydney has recently proposed a stamp duty surcharge of 4% and a 0.75% land tax in its budget, following the move by Victoria and Queensland. The proposal on stamp duty surcharge has been made official just recently in June 2016, while the 0.75% land tax will be imposed in year 2017.