His comments come as brickbats continue over the government’s decision to lower the threshold for foreigners buying high-rise homes from RM1 million to RM600,000.

Asked on the matter after an event here today, Mahathir said he had criticised Forest City because the property was said to be freehold and luxurious.

“Only foreigners can afford to buy,” he said after launching a medical device conference and exhibition at Mitec here.

“This (properties with lowered thresholds) is not for foreigners who can afford to buy.”

Mahathir had spoken against the sale of land to foreigners prior to last year’s general election, especially in the Forest City project which will span 1,386 hectares across four man-made islands in Johor’s Iskandar region.

He said in August last year that Malaysia would not allow foreigners to buy residential units in the project, although his office later clarified that foreigners would be allowed to own property subject to certain conditions.

Speaking today, he said there were people who were not as financially well off who wished to buy property in the country.

“They can buy these cheaper flats and apartments,” he added.

“The reason for this is, we have a property overhang which could result in a financial crisis.”

He gave the example of Hong Kong and Tokyo where he said such situations had arisen due to overdevelopment.

“We have to get rid of this overhang so that the property market becomes healthy again.”

Forest City, on the other hand, was a different matter, he said.

“It is a very luxurious development which Malaysians cannot afford to buy. Since there are not enough Malaysians buying, there is an overhang.

“We need to sell them or the developers will get into trouble.”