Malaysia Property Market Outlook

Navigating the post-pandemic recovery, infrastructure booms, and the road to 2026 investment maturity.

Projected GDP Growth

4.8%

📈 2025-2026 Forecast

Economic stability fuels property purchasing power.

Transaction Volume

+5.2%

🏙️ YoY Increase

Market activity returning to pre-pandemic levels.

Overhang Reduction

-7.0%

📉 Absorption Rate

Inventories clearing, especially in prime locations.

House Price Index (HPI) Trajectory

After a period of stagnation (2020-2022), the Malaysian House Price Index is demonstrating a steady upward curve.

Key Insight: The chart projects a CAGR of ~3.5% leading into 2026, driven by cost-push inflation (materials) and renewed demand in transit-oriented developments.

Forecast: Moderate capital appreciation is expected, moving from a buyer's market to a balanced market by late 2025.

Regional Powerhouses: Transaction Volume

Comparing major economic corridors (2024 Actual vs 2025 Proj)

Selangor: Remains the volume leader due to suburban sprawl.

Johor: Fastest growth rate projected due to the RTS Link to Singapore completion (2026).

The "Overhang" Composition

Breakdown of Unsold Inventory by Property Type

High-Rise Saturation: Service apartments and condos make up the bulk of overhang, particularly in the RM500k-RM1mil bracket.

Investment Matrix: Risk vs. Rental Yield

Analyzing different property sub-sectors. KL Luxury Condos offer high appreciation potential but lower immediate yields compared to Industrial Logistics.

🏭

Industrial

High Yield

🏙️

KLCC Condo

High Appreciation

🏡

Landed

Safe Haven

🏢

Office

Oversupply Risk

Drivers Shaping the 2026 Landscape

🚆

Infrastructure

Completion of the RTS Link (Johor-SG) and progress on MRT3 Circle Line will unlock value in connected suburbs.

🌏

Policy Shifts

Revamped MM2H (Malaysia My Second Home) program with tiered categories attracting affluent foreign buyers.

🌿

ESG & Green

Developers prioritizing Green RE certification. Premium rentals for energy-efficient buildings.

🚀

2026 Boom

Market maturity. Johor Bahru emerges as a true twin-city to Singapore. KLCC yields stabilize.

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