How You Can Sell Your House (But Continue Living There) To Fund Cancer Treatment

Under KALSIS, Malaysian seniors in the Klang Valley with cancer can sell their house to the scheme to fund their treatment, while continuing to live in that property for life. They get lump sum payments for health care, plus monthly payments until their passing.

PETALING JAYA, July 1 — A Singapore-based company in partnership with Kenanga Investors Berhad has made an innovative proposal for Malaysian senior citizens with cancer to finance their medical treatments by unlocking wealth from their biggest asset: their home.

Under the KALSIS scheme, Malaysians aged 65 years and older battling cancer and living in the Klang Valley can sell their freehold landed property title to KALSIS at market value.

After monetising their home, KALSIS participants can continue residing in the property for life.

For example, if the property is sold to KALSIS at RM1.5 million (also called the Entry Value), the KALSIS participant will receive a RM150,000 lump sum amount (10 per cent of the Entry Value) in the first year.

In Year 2 and onwards, the KALSIS participant can receive either another lump sum amount of RM60,000 for health care needs (4 per cent of the Entry Value) or RM5,000 monthly payment (4 per cent of the Entry Value).

Under the scheme, KALSIS participants receive complimentary services too, such as basic home repairs and home maintenance, basic pest control, selected fire safety devices, home insurance (for the structure only), and full coverage of quit rent and assessment charges.

The scheme ends when the remaining KALSIS participant living in the home passes on.

When the KALSIS participant sells their property to the scheme, they can nominate an individual — for example, one of their adult children or anyone else – as a nominee to receive apportioned proceeds when KALSIS sells the property. These apportioned proceeds will only be paid to the nominee when all participants living in the home pass on and the property is sold within 10 years from when the scheme commenced.

If the proceeds of the property sale exceed the Entry Value, the apportioned proceeds for the nominee will be calculated proportionately i.e. Year Two (72 per cent of the Entry Value), Year Five (63 per cent of the Entry Value) and Year Ten (40 per cent of the Entry Value).

If the proceeds of the property sale are less than the Entry Value, the apportioned proceeds for the nominee will be scaled proportionately.

KALSIS was inspired by the French viager model, where qualified seniors sell their home title at market value to receive lump sum payouts and monthly lifetime annuities while being able to age in place without moving.

When they pass on, their residence is sold and the capital is returned to investors. The KALSIS scheme is funded by institutional investors seeking to do good and do well at the same time – with Kenanga Investors Berhad leading the charge.

Malaysian Retirees Face ‘Multiple Crises’, Lack Health Insurance

An infographic on how KALSIS works. Infographic courtesy of KALSIS.

At a presentation of the KALSIS scheme at the National Cancer Congress Malaysia 2024 on June 23, KALSIS CEO Jonathan Teoh highlighted “multiple crises” faced by retirees in Malaysia.

He pointed to Employees Provident Fund (EPF) statistics, noting that less than 4 per cent of EPF contributors can afford to retire, which means many will have inadequate savings in the future.

“Coupled with insufficient private health insurance coverage, this potentially leaves many elderly people in a financially vulnerable situation,” Teoh said in his presentation.

Teoh emphasised that the data captures only EPF contributors and not senior citizens outside the system, making the situation even more alarming. Additionally, nearly one-third of annual cancer diagnoses are among elderly people, a figure expected to double to 43,000 annually by 2040, he added.

According to the Malaysia National Cancer Registry Report 2012-2016, the most common cancers afflicting males in the 60-74 year age group were colorectal (18.7 per cent), lung (17.9 per cent) and prostate cancers (12.9 per cent). In females, the most common cancers were breast (28.8 per cent), colorectal (14.2 per cent) and lung cancers (8.1 per cent).

“The lack of insurance among seniors is particularly concerning. Currently, around 80 per cent of those aged 60 to 69 lack any form of insurance, a figure that rises to over 90 per cent for those over 70,” Teoh said.

Downside With Personal Loans, Selling Property In Open Market, Reverse Mortgages

Financing health care, especially costly cancer treatments, is a significant challenge for seniors.

Personal loans are one potential option, Teoh said, but seniors are often excluded from obtaining them due to their age and retiree status. While adult children might be able to help, they may face their own financial constraints as they’re likely to have their own families with young children.

Similarly, selling one’s home in the open market and renting for life is another option, but it comes with uncertainties. The risk of having to move (again) from a rented home and the danger of outliving one’s savings are real concerns. Senior citizens will also likely find moving house to be a very stressful event.

Reverse mortgages are available in Malaysia, allowing seniors to borrow against their home’s value, with repayment typically occurring upon their passing.

“However, these come with high costs due to hefty transfer expenses, and the high interest rate environment leads to accruing interest over time. Repayment through property auction often doesn’t fetch the best price,” Teoh said.

Surviving Spouse Can Continue Staying In Their Home

The KALSIS scheme does not end when the participant thrives from their cancer treatment, Teoh told CodeBlue at the sidelines of the NCCM 2024 conference.

“Let’s say you are in remission and no longer need hospital care. We take the RM60,000 and divide it over 12 months, giving you a RM5,000 monthly annuity, which is based on 4 per cent of a home sale price of RM1.5 million,” he said.

The beneficiary nominated by the KALSIS participant will receive a portion of the proceeds of KALSIS’ property sale if the participant dies within 10 years of the scheme.

“We introduced this feature because many people expressed concerns like, ‘What if I pass away in five years?’. They worry about selling a home valued at RM1.5 million and only receiving a fraction of it in a short time,” Teoh said.

“Therefore, we ensure a portion of the proceeds is given back within 10 years. The scheme ends when both seniors living in the home have passed away. If one senior passes away, the scheme continues with the surviving senior citizen, who can still remain in the home.”

After NCCM 2024, Teoh told CodeBlue that the KALSIS scheme received a very positive response from the conference.

“We’ve had so many people (doctors, allied health, non-governmental organisations) kindly opening up their networks to us so we can provide their communities of seniors battling cancer another option in funding their treatments and living expenses in recovery.”

KALSIS is now serving eligible seniors living in qualified homes. Further inquiries can be made to its website.

Eligibility Criteria For KALSIS Scheme

Senior must be:

  • Malaysian, Permanent Resident or MM2H Resident
  • 65 years old and above (includes spouse or partner)
  • Owner of the home and has the requisite legal capacity to sell the home
  • Currently undergoing treatment for cancer (If two seniors own the home, one of the two seniors must be undergoing treatment for cancer)

Home must be:

  • Freehold, landed and located in Klang Valley (certain postcodes excluded)
  • Occupied by owner as their primary place of residence
  • Free from all encumbrances, such as mortgage and/or other financial liabilities. All property taxes, management fees (where applicable) and utility bills have to be paid up to date
  • Not built on Malay reserved land, not a low-cost/ medium-cost affordable home, not a designated Bumiputera unit
  • Valid and effective legal title issued under the name of the senior
  • Valid Certificate of Completion and Compliance / Certificate of Fitness for Occupation
  • Meets KALSIS evaluation criteria

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