Most foreign buyers I speak with want the property to pay for itself while they're not using it. That's a reasonable expectation, and it's achievable — but it requires understanding two things upfront: the property type determines whether short-term rental can be licensed under Penang's 2026 homestay by-law, and the numbers look quite different between STR and long-term rental depending on the project and location.
This is the guide I wish more buyers read before signing.
The First Question: What Does the Title Allow?
Residential strata properties (ordinary condominiums and apartments) are intended for owner-occupation and long-term tenancy. On Penang Island they cannot be licensed for short-term rental under the Private Homestay By-Law 2026, whatever the building's house rules say; enforcement starts on 1 November 2026. Landed homes on the island can only be licensed in designated zones with a change-of-use approval.
On the mainland the rules are looser: condominiums and apartments can be licensed, but only with a management-body special resolution of at least 75%. Either way, check the licence position before you sign the SPA, not after.
Commercial title properties (serviced apartments, SOHO, suites) operate under commercial or mixed-use zoning. On the island these are the types that can be licensed for short-term rental, but each still needs a 75% management-body vote and a council licence; a developer's "Airbnb-friendly" marketing is not a licence. The trade-off is higher utility tariffs (commercial electricity and water rates) and a floor plan that sometimes skews toward smaller, denser units.
For foreign buyers, there is one important note: the 70% LTV cap applies to both residential and commercial-title purchases anyway. The LTV disadvantage that Malaysian citizens face on commercial title (from the usual 90% down to 70%) is irrelevant for you — you were already at 70% regardless. So the commercial-title limitation that affects local buyers does not affect you in the same way.
Projects That Suit STR
These are active launches where the format and/or developer positioning is compatible with STR use. Always verify the project's house rules directly before committing to an STR strategy.
Important caveat upfront: hotel-branded residences such as W Residence Gurney Bay and Marriott Residences are positioned for own-stay or holiday-home use, not as individual-owner STR rentals. The hotel operator controls the brand and the building's hospitality standards — owners are not free to list their units on Airbnb. If you want a hotel-branded residence, buy it as an own-use lifestyle asset, not as an STR yield play.
The projects below are the ones I would actually consider for short-term rental strategies. STR suitability depends on title type, house rules, and location demand — always verify the project's current house rules before committing.
Maritime Signature (entry units fall below the RM1,000,000 foreign-buyer minimum) — leasehold SOHO from RM500K in Jelutong. SOHO is one of the property types the 2026 by-law allows to be licensed on the island, subject to a 75% management-body vote and a council licence. That vote can only happen once the management body exists after handover, so model long-term rent first.
Noordinz Suites (every unit sits below the RM1,000,000 foreign-buyer minimum) — freehold (commercial HDA title) suites sold out off-plan at about RM627K–956K in Georgetown. Suites-format, freehold, Georgetown address. Serviced suites are a licensable type under the 2026 by-law, subject to the 75% vote and a council licence. George Town heritage demand is strong; confirm the building's licence position before you rely on it.
Scott @ Logan (entry units fall below the RM1,000,000 foreign-buyer minimum) — freehold from RM436K in Georgetown heritage fringe. As a serviced apartment it is a licensable type, but only after handover, when a management body exists to pass the 75% vote. Georgetown's STR demand is the relevant driver. Foreign buyers target RM1M+ units.
G'Vinton (entry units fall below the RM1,000,000 foreign-buyer minimum) — freehold from RM596K in Georgetown. Commercial HDA title, so a licensable type, subject to the same 75% vote and council licence. Confirm the licence position before committing.
For furnished long-term rental (1–12 month leases, not nightly STR), the expat-area projects in Tanjung Tokong (Crown Penang — whose entry units fall below the RM1,000,000 foreign-buyer minimum) and Tanjung Bungah work well — corporate relocations, school-year leases, and visiting family generate consistent demand for furnished medium-term lets without the operational overhead of nightly Airbnb management.
STR vs Long-Term Rental: The Numbers
The gross yield comparison depends heavily on occupancy and management quality, but here's how I typically frame it for buyers:
| Factor | Short-Term Rental (STR) | Long-Term Rental |
|---|---|---|
| Gross revenue potential | Higher (RM150–400/night depending on area) | Lower but predictable (RM1,500–3,500/month typical) |
| Occupancy risk | Significant — low occupancy kills the model | Low — good tenants sign 1-year leases |
| Management effort | High — property manager essential | Low — placement fee + annual checks |
| Management cost | 15–25% of revenue | 8–10% of monthly rent |
| Furnishing requirement | Full, high-quality — guests compare against hotels | Basic to mid-range is sufficient |
| Vacant period costs | You absorb all costs when empty | Tenant absorbs utilities; minimal void periods with good PM |
| Suitability by location | Georgetown >> Tanjung Tokong > Tanjung Bungah | All areas, strongest in expat areas and near USM |
My view: long-term rental is lower risk and more predictable for foreign owners managing from abroad. STR has higher upside but requires active management, a quality furnishing investment, and consistent occupancy to beat the long-term yield. Unless you are committed to a high-quality STR setup with a professional manager, long-term rental tends to produce better real net returns on a risk-adjusted basis.
Georgetown is the exception — in my experience demand there is year-round enough that a well-managed, licensed STR unit can outperform long-term rental in the same building.
Managing From Abroad
You cannot self-manage a Penang STR property from overseas. You need a property management company on the ground. Here's what that looks like in practice:
Long-term rental management: Your manager lists the property, screens tenants, collects rent, handles maintenance calls, and transfers net rent monthly to your Malaysian account. You transfer to your home-country account from there. Total cost: 8–10% of monthly rent. The process is well-established and many overseas landlords run this arrangement for years with minimal intervention.
STR management: Your manager handles listing creation, guest communication, check-in/check-out, cleaning, linen, and maintenance. Revenue is more variable and you need a manager who actively adjusts pricing for demand periods. Cost: 15–25% of gross revenue. The quality of the manager matters more here — a mediocre STR manager in Georgetown will significantly underperform what a strong one can achieve.
Opening a Malaysian bank account: You will need a Malaysian bank account to receive rent. Most major banks (Maybank, CIMB, Public Bank) will open accounts for foreign nationals with a passport and property purchase documents. Some buyers open accounts on their first visit to sign the SPA; others open remotely with the assistance of their solicitor. Confirm with your preferred bank's current foreign account opening requirements.
Repatriating Rental Income
Malaysia does not restrict outward remittance of rental income or sale proceeds by foreign owners. Once rent is in your Malaysian account, you transfer to your home-country account as a standard international bank transfer. The main friction is exchange rate — you convert MYR to your home currency at the prevailing rate, which adds currency exposure to your yield calculation.
Rental income is taxable in Malaysia. Consult a Malaysian tax advisor on the non-resident treatment before committing to a rental strategy — the structure can affect your net yield noticeably.
Zac’s Take
Zac Ong
The question I get most often from overseas buyers is: 'Can I Airbnb it?' My honest answer is: maybe, but you should be buying for the long-term rental income first and treating STR as a bonus, not a baseline assumption. The buyers who get into trouble are the ones who bought with STR projections pencilled in and then discovered the house rules ban it, or the occupancy never reached the levels they modelled. Georgetown is where I'd consider STR seriously — the demand is structural and the management ecosystem is mature. Everywhere else, I'd run the long-term rental numbers first and see if the investment makes sense without the STR upside. If it does, you have a margin of safety. If it only works on optimistic STR projections, that's a risk signal.
If you're a foreign buyer trying to model the rental income potential of a specific property, reach out directly. I can give you a realistic sense of what long-term vs STR yields look like for the projects you're considering, and connect you with property management contacts who can give you ground-level occupancy data.
Sources: Project details verified against developer materials and live portal listings by Zac Ong, REN 64593. Foreign-buyer rules per current Malaysian federal and Penang state policy. Verify current unit-by-unit numbers with a licensed conveyancing lawyer before signing.