This Malaysian city is officially the most budget-friendly spot for digital nomads — they spend just $950 per month to live there

Penang, an island off Malaysia’s northwestern coast, claimed the top spot with an overall score of 0.78 out of 1. The study estimated that a one-bedroom apartment near the center costs €393 a month, leaving approximately €457 for other expenses within its €850 monthly budget. In USD, that’s approximately $440, $500 and $950, respectively.

Penang also benefits from Malaysia’s DE Rantau Nomad Pass, an official program for eligible remote workers that allows them to live in Malaysia for 12 months, with the option to renew. And English proficiency in Penang is rated high, while crime is rated low, which could make daily life easier for newcomers.

“The good news is that language is rarely a barrier, since English is widely spoken across the island, and Malaysia is generally considered a safe place to live,” James Owen, co-founder and director of Click Intelligence told Moneywise.

The results come as digital nomadism continues to grow. According to MBO Partners’ 2025 Digital Nomads Trends Report, an estimated 18.5 million American workers identified as digital nomads in 2025, up 2.2% from the previous year. The number of nomads has jumped 153% since 2019. Today, 12% of the U.S. workforce is made up of digital nomads.

Malaysia is also attracting more international visitors. The country recorded 42.2 million visitor arrivals in 2025, an 11.2% increase from 38 million in 2024, according to Malaysia’s national news agency, Bernama. And American visitors are part of that market: Tourism Malaysia’s 2024 statistics recorded 304,880 visitor arrivals from the United States, up 18.4% from 257,533 in 2023.

For remote workers looking to stretch their paychecks while experiencing a new culture, Penang offers more than inexpensive accommodation.

Historic streets, world-famous food and nature

Penang’s biggest draw for budget-conscious digital nomads is its combination of relatively low living costs and an established cultural and culinary scene.

The island’s capital, George Town, is a UNESCO World Heritage Site recognized for its historic architecture and centuries of cultural exchange. According to UNESCO, George Town and the Malaysian city of Melaka developed over 500 years of trade and cultural exchange between East and West, creating distinctive historic urban centers.

“Most digital nomads live in George Town,” Own said. “It’s walkable, full of character and home to most of the island’s cafes and coworking spaces.”

Those who prefer modern condos, malls and Western comforts, he added, often choose Gurney Drive or Pulau Tikus, which are close to the old town. But for a quieter and more coastal lifestyle, others head north to Tanjung Tokong and Tanjung Bungah. Batu Ferringhi, Owen continued, is another option for those who want to be by the beach.

Across Penang, visitors can explore colorful shophouses, Chinese clan houses, historic mosques and temples, and colonial-era buildings throughout George Town. The city is also known for its street art, including murals and installations scattered throughout its historic neighborhoods.

For digital nomads, that means there is plenty to do without spending much money.

“Culture is really what sets Penang apart,” Owen said. “George Town’s heritage streets, colourful street art and temples make it a lovely place to explore between work sessions.”

Food is another major attraction. Penang is famous for its hawker stalls and food markets, where visitors can sample Malaysian specialties alongside Chinese and Indian influences. Popular dishes include char kway teow, a stir-fried noodle dish, and assam laksa, a tangy fish-based noodle soup.

“Its hawker food is famous across Asia, so eating out is both a highlight and very affordable,” Owen explained.

Outside George Town, the island offers plentiful opportunities to escape the city, as well. Visitors can hike in Penang National Park, explore forest trails, spend time at Batu Ferringhi beach or take the funicular railway up Penang Hill for views across the island and surrounding coastline.

“Nature is never far away,” Owen said. “Penang Hill offers cooler air and great views, and Penang National Park has jungle trails and quiet beaches.”

But he also said that “newcomers should be prepared for heat and humidity all year round, as well as occasional haze.” If the heat gets to be too much, however, Owen mentioned that “Penang’s airport also offers short, low-cost flights to Kuala Lumpur, Singapore and Bangkok, which makes weekend trips easy.”

The combination of urban culture, outdoor activities and accessibility to adventure could appeal to digital nomads who want a destination where they can spend weekdays working and weekends exploring.

Affordable housing is only one piece of the puzzle

Overall, Penang had the lowest all-in monthly cost of all 26 cities the study compared, at €850 a month for one person, with rent included.