Cost of Living in Malaysia For Expats
When looking for a place to retire, the cost of living is arguably the biggest concern for the majority of people. Most people, whether you’re single, a couple, or a family on a fixed budget, want to live in a place with all the comforts of home, without the same high costs. Penang, an island off Malaysia’s northwest coast, is just the place.
Property
In 2014, the Penang property market started to be noticed by Singaporeans. A three-bedroom shophouse in George Town, Penang, would have cost about $400,000 then, and an identical house in Singapore would have cost upwards of $4 million. This is an important factor to note because, in one buying spree, one Singaporean company bought over 1,500 houses in George Town in one single day. This changed the economy of Penang overnight and fuelled the second property boom in seven years. The first took place in 2008 when Penang and Malacca were awarded a UNESCO World Heritage Listing. This caused property prices in both cities to double and then triple in a matter of months.
The good news is that rents didn’t increase at all, and haven’t increased since 2017. There is a glut of rental properties on the market, and more hi-rise, hi-spec condominiums are being built as I write. Most condos in Penang and Kuala Lumpur have 40% to 60% occupancy, meaning that rents will stay low for some time.
On $2,500 a month, a couple can live exceptionally well. Renting in a modern high-rise with a pool, gym, 24-hour gated security, covered car space or two, shared communal area with a barbecue, will cost a mere $750 to $1,000 per month. For that price, you could find a modern 2,300-square-foot condo with three or four bedrooms, three to five bathrooms, and a balcony overlooking the ocean.
If you don’t care to live with a view or by the beach, you can rent a two or three-bedroom place for about $550 to $650, which means you could easily live on less than $2,000 a month.
Lifestyle
While the unprecedented level of international investment that came courtesy of Singaporean companies drove buying prices up for property, it also had more positive impacts. A plethora of new cafés, restaurants, and hotels—places where you could suddenly spend more money should you choose to, popped up that were not there before. For example, in 2009, there was one European-styled café in George Town then, and by 2014 there were at least five or six Western-styled cafés on every street. Wine bars, something I remember from the early 1980s, are popular again, as are imported wines from Australia, Chile, France, Italy, New Zealand, and the United States.
There are also Cuban cigar lounges where you can sit or take away your favorite stogie. San Cristobal de la Habana La Punta, or Ramon Allones Superiores LCDH, are popular with locals and expats alike.
French-style bakeries, there are now three of them in George Town, arrived with their own Cordon Blue bakers, and suddenly the price of a cup of coffee went through the roof. Currently, a cup of coffee at Starbucks or a similarly styled café averages around $3.50, on par with the rest of the world, but this is Malaysia. Thankfully you can still get a local cup of coffee in town at a local cafe for 50 cents. Yes, it’s black, strong, and usually sweetened, but if you are on a budget, two or three cups a day quickly adds up.
There are also Cuban cigar lounges where you can sit or take away your favorite stogie. San Cristobal de la Habana La Punta, or Ramon Allones Superiores LCDH, are popular with locals and expats alike.
French-style bakeries, there are now three of them in George Town, arrived with their own Cordon Blue bakers, and suddenly the price of a cup of coffee went through the roof. Currently, a cup of coffee at Starbucks or a similarly styled café averages around $3.50, on par with the rest of the world, but this is Malaysia. Thankfully you can still get a local cup of coffee in town at a local cafe for 50 cents. Yes, it’s black, strong, and usually sweetened, but if you are on a budget, two or three cups a day quickly adds up.
Pampering yourself is another level in Malaysia. A two-hour facial at a swanky spa in George Town, where you are treated royally, is just $40. Back home, a similar treatment in a similar facility would cost $250. If you want to splurge, you can get a pedicure for about $10 or a foot massage for $3. With those prices, why not indulge? One American couple here has a masseuse come to their apartment once a week. For a two-hour full body massage, she charges, in the comfort of your own home, just $25 per person. That’s great value no matter where you are in the world.
A part-time cleaning lady costs $5 per hour. If you want a live-in maid, and keep in mind that all condos here come with maid’s quarters, complete with a bathroom and shower, it will cost about $500 per month. Most maids work five and a half days a week, and half a day on Saturday with Sunday off.
Living Like a Local
A large component of the cost of living revolves around your lifestyle. If you eat out at expensive restaurants, (and there are some world-class restaurants in Penang, one with a Michelin one-star rating), and drink expensive wines regularly, you’ll have to budget for it. Imported wines, as there are no Malaysia wines of note, cost an average of $10 per bottle. Scotch, and well-known run-of-the-mill brands, like Johnnie Walker Black Label, cost $50, compared to $22 back home. Hendricks Gin, $29 at home, will set you back $70.
Of course, by embracing the lifestyle of a local, you can cut your total monthly costs down significantly. Keep in mind that Penang is known throughout Southeast Asia for its exquisite food. Eat where the locals eat. It’s safe for foreigners and delicious, and you will only pay about $2 for a plate of noodles or rice with chicken and vegetables and up to $10 for a whole steamed fish—plenty of food for two people. And where you see many locals eating – that’s where you should be heading. Penangites (people who hail from Penang), while having breakfast, talk excitedly about where they will have lunch, and at lunch, they’ll chat enthusiastically about where they will be having dinner. At dinner, they’ll discuss plans for breakfast the following morning, where to go, etc., and the cycle continues.
Malaysia is also a fruit enthusiast’s paradise. And its fruit is abundant and cheap. The king of fruit here is durian, and international visitors come from far and wide to experience Malaysian durian. But there are also mangosteens, chempedak, rambutans, mangos, starfruit, guava, papayas, and bananas, all grown locally. The local wet markets are well stocked with local meats like pork and beef, along with a variety of fish, chicken, and fresh vegetables. And it’s much more affordable than anything that is imported. At grocery stores, and even at restaurants, western food is more expensive. Plus, the market stall vendors are really friendly, so it’s an excellent way to get to know more locals. The choices offered throughout Malaysia, on the whole, are exceptionally good value.
Travel
One of the things that also makes Malaysia rather special is its geographic position. It’s in the middle of South East Asia, meaning that traveling in the surrounding area is easy, affordable, fun, and something you absolutely should budget for. Penang International Airport has direct flights to Thailand, Cambodia, Indonesia (Bali and Jakarta), Laos, India, and the Philippines. Connections to Europe and the U.S, in the majority of cases, will have to be done through Kuala Lumpur (KL), and from Penang, KL is just 50 minutes away. A return flight to KL can cost as little as $50.
If you live in Penang, then driving to Thailand is also a great option, and there are expats and Malaysians who go there for lunch, or for a few days to a few weeks, and then drive back again. Driving from George Town to the Thai border takes just two hours.
Ensure you have your car registration papers, if you own your car or if it’s a rented vehicle, and your hire documentation. You’ll also need your passport and driving license. The procedure of getting through immigration is similar to driving from the United States to Mexico or Canada, the only difference being that when you hit the Thai side of the border, you must stop and purchase Thai car insurance for the duration of your stay in Thailand. Like most Western countries, the cost of the insurance is based on your vehicle, small car, large car, BMW vs. Axia, and can cost up to $100. For an Axia or something or something similar, it usually comes in at around $30 for the duration of your visit.
If you don’t drive, or don’t want to hire a car to self-drive, there are drivers with luxury air-conditioned vans that seat between eight and 12 people, that will take you there and back again. Usually, they are only good for a two-to-three-day stay and cost about $50 per person, but it’s exceptional value if a group of you are going. You’ll also have a choice of the driver staying with you and ferrying you around during the day, which will cost extra, or just dropping you off at your hotel and picking you up at a predetermined time when you are ready to return to Malaysia.
Transportation
Most expats buy cars when they arrive in Malaysia. Keep in mind that Penang is a small island, and you don’t need a large sport utility vehicle here. Small, standard, locally made, four-door hatchbacks, like the Perodua Axia, start at just $6,000. Scooters are also popular, and a 150cc Honda scooter costs just $2,000 brand new. Vespa, an Italian luxury brand of scooters and mopeds manufactured by Piaggio, costs $4,000. And, of course, there is a very good second market due to people leaving, and good-value cars and scooters are always for sale. They turn over quickly, so if you see something you like and the price is right, don’t haggle.
Petrol/Gas prices at Malaysian pumps are among the lowest in the world, thanks to a generous fuel subsidy scheme put in place by the Malaysian government. Filling the Vespa up will cost just $5; even if you use it seven days a week, it will last about two weeks. An Axia will cost, on average, $15 at the pump and last for about the same time.
Expats who don’t buy cars or bikes can get around using the Malaysian public transport system, which is very good; also use Grab, which provides users with transportation, food delivery, and digital payment services via a mobile app. Prices have gone up since the end of Covid, but it’s a convenient taxi service, with friendly drivers, at a fraction of the cost of a taxi. Make sure you download the Malaysian app before leaving home.
Keep in mind that Malaysia has two seasons—wet and dry—and when the wet season hits, and the heavy monsoonal rains come, getting a Grab can be problematic as demand is high. There will be delays, and you may not get one at all, which will suddenly make your shopping trip or evening out all the more difficult.
Healthcare
The cost of healthcare in Malaysia is so low that few expats have health insurance, and most people prefer to pay out of pocket. There are seven hospitals on the island of Penang, so there are plenty of doctors and specialists to choose from. Most of them were trained in the UK, the U.S., or Australia, and the quality of care and standards in most hospitals are the same as in the Western world. The big difference in Malaysia is that you don’t have to make an appointment with an MD or a specialist. And you don’t need a recommendation from an MD to see a specialist, either.
All doctors and medical staff speak English, making understanding the issues and dealing with foreign patients easy. And from a patient’s point of view, you have peace of mind, knowing that you can communicate with the doctor dealing directly with you.
In 2022, over 1 million medical tourists flew into Malaysia for elective and non-elective surgeries, and the prediction for 2023 is that that number will grow by one-third. Healthcare in Malaysia is at a high standard and is of exceptional value.
Sample Monthly Budget
Here’s a sample budget for a couple living in Penang, Malaysia:
| Expense | U.S. $ |
| Rent | $900 |
| Groceries | $200 |
| Electricity | $100 |
| Water | $.50 |
| Cell phone | $18 |
| Internet and landline | $35 |
| Pay TV (Astro) | $45 |
| Butane gas (for cooking) | $0.90 |
| Fuel for car | $25 |
| Maid (four hours a week) | $80 |
| Entertainment (eating out five nights a week, local and western food, alcohol not included) | $300 |
| Monthly Total: | $1,704.40 |