GEORGE TOWN: Foreign ownership of properties in Penang is on the decline, contrary to claims by a heritage-interest group, the state government said today.

State Executive Councillor Jagdeep Singh Deo said measures put in place since 2012 had reduced the buy-up of properties in Penang.

He said, however, the strengthening of the greenback had given foreigners stronger purchasing power and had led to the bulk buying of properties.

Jagdeep said in recognition of such problems, the Penang Government introduced a rule where foreigners could only buy properties beyond RM2 million on the island and RM1 million on the mainland.

He said for apartments, the cap was set at RM1 million for those on the island and RM500,000 on the mainland.

He added an “approval fee” of three per cent had also been levied on them since April 2014.

Jagdeep said the measures had reduced purchase of properties since July 1, 2012.

He said foreign purchases had “fallen far short” of overall property purchases in Penang ever since. He added the drop was more than half this year, compared with 2013.

“We will conduct a periodic review of policies, including the measures put in place to control purchases of properties by foreigners,” Jagdeep said in a statement today.

Jagdeep was commenting on heritage-interest group George Town Heritage Action’s claim yesterday that a Singaporean company, among others, had snapped up many heritage-worthy properties just outside the World Heritage Site.

It was reported that the foreign developer had bought “over 200 properties in George Town” and that this could erode Penang’s unique heritage if these buildings were redeveloped.

The developer was accused of planning to retain only the facade and gut the rest of the buildings for high-rise projects.