Is George Town property still worth buying?

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Are George Town property prices still rising?

George Town property prices are no longer rising strongly enough across the board for us to buy almost anything and expect the market to carry it upward.

Recent JPPH transaction data make the slowdown fairly clear. Over the latest 12-month period available, the median transaction price across George Town was around RM470,000, roughly 3% lower than in the preceding period. Across the wider Timur Laut district, which covers George Town and much of northeastern Penang Island, the median was around RM365,000 and had fallen by roughly 6%.

Those headline numbers need some care because George Town mixes cheap old apartments, multimillion-ringgit waterfront condos, landed homes and heritage properties. Brickz recorded a median of about RM345,000 for non-landed residential transactions in George Town, while the much smaller condominium sample had a median around RM1.31 million. The gap is enormous.

Today's George Town market is highly selective. Expensive units in recognised projects still change hands at four-figure prices per sq ft, while ordinary stock has much less pricing power. We would no longer assume that buying in George Town itself is enough to produce appreciation.

Is George Town property expensive now?

Prime George Town property is expensive today, and some projects are expensive enough that we would need a very specific reason to pay the premium.

Recent transactions show how wide the price range has become. Shorefront Residences recorded a recent median near RM2.16 million and roughly RM1,262 per sq ft. Gurney Paragon transactions have also remained above RM1,000 per sq ft, with a recent median around RM3.1 million. Tropicana 218 Macalister has been trading closer to RM1 million to RM1.2 million for many units, with its latest complete transaction sample around RM1,036 per sq ft.

Move only a short distance into older stock and the numbers change completely. Recent non-landed transactions in Pulau Tikus had a median around RM680,000 and RM576 per sq ft, while older projects such as Midlands Condo have traded near RM400 per sq ft.

Paying RM1,100 per sq ft can make sense for genuine waterfront scarcity, strong views, walkability or a proven tenant base. Paying the same amount for an interchangeable unit simply because the address says George Town is much harder to defend these days.

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Does George Town have too many condos now?

George Town condo buyers should take Penang's growing high-rise supply seriously because the island has added homes much faster than transaction activity has grown.

NAPIC data show Penang's high-rise stock rising from about 109,600 units in 2021 to roughly 142,600 in 2025. That means around 33,000 additional units appeared in only four years, an increase of roughly 30%.

Sales activity went in the other direction after 2023. Penang recorded 4,240 high-rise transactions that year, followed by 3,575 in 2024 and 3,354 in 2025. Transaction value also slipped from about RM2.62 billion in 2023 to RM2.15 billion in 2025.

The latest NAPIC numbers also show that residential overhang remains a problem. Penang had 3,165 completed unsold residential units in the first quarter of 2026, up around 16% from 2,729 a year earlier.

There is very little reason to pay a scarcity premium for an ordinary high-rise unit. Penang Island may have limited physical land, yet developers have proved that they can still add tens of thousands of apartments vertically. Real scarcity now comes from the individual property: a protected heritage location, a genuinely exceptional waterfront position, a large established unit in a low-density neighbourhood or something else that future towers cannot easily copy.

Does George Town's UNESCO status really protect property values?

George Town's UNESCO status gives the heritage core real scarcity, especially for buildings and sites that cannot simply be replaced by another tower.

The George Town World Heritage Site Special Area Plan tightly controls what can be demolished, altered and rebuilt. Category I buildings retain their existing height. Category II buildings are generally expected to preserve their original height as well. New infill development in much of the heritage area faces height restrictions and can require a Heritage Impact Assessment.

Those rules place an unusually hard ceiling on new supply in the historic core. A developer cannot buy a row of protected shophouses and freely replace them with a 40-storey condominium. That gives genuinely scarce heritage assets a stronger long-term argument than another apartment in a high-density suburb.

The protection comes with costs. Heritage owners can face stricter renovation rules, specialist restoration work and less freedom to redevelop. A beautiful shophouse with poor structural condition can easily become an expensive project.

For us, UNESCO status adds the most value when the property itself participates in that scarcity. A protected shophouse, a rare low-rise property or a home directly beside the historic core can deserve a premium. A generic tower several kilometres away gets much less benefit from the UNESCO label.

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Are the best George Town condos still holding their value?

The strongest George Town condos are still commanding serious prices today, although buyers have become much more selective about which buildings deserve them.

Shorefront Residences is a good example. Six transactions recorded during the final four months of 2025 produced a median around RM2.16 million and RM1,262 per sq ft. At Gurney Paragon, ten transactions recorded during 2025 had a median around RM3.13 million and RM1,152 per sq ft. Tropicana 218 Macalister occupied a cheaper tier, with its latest complete transaction sample around RM1.17 million and RM1,036 per sq ft.

Compare that with the wider market and the split becomes obvious. Older Pulau Tikus condominiums can trade around RM400 to RM600 per sq ft, while selected prime projects remain above RM1,000.

Buyers are still willing to pay heavily for recognised buildings, sea frontage, larger layouts and central locations. The premium just has to be earned now. We would be much less comfortable assuming that a newly launched project can command the same resale premium simply because its brochure uses the words luxury, George Town or Gurney.

Do George Town rents actually justify today's prices?

George Town rents justify some smaller and mid-priced units, while the most expensive condos often produce yields that are too low to excite us.

Current asking rents show the difference. Smaller Mansion One units of roughly 600 to 670 sq ft commonly appear around RM2,500 to RM3,000 a month. Tropicana 218 Macalister studios are often marketed near RM2,000 to RM2,300, while larger two-bedroom units can reach roughly RM3,400.

At Shorefront, units around 1,400 to 1,500 sq ft have recently been marketed near RM5,500 a month. Large Gurney Paragon units often appear around RM7,000 to RM8,500.

The absolute rents sound strong until we compare them with purchase prices. RM7,200 a month on a RM3.1 million property works out to only about 2.8% gross. A RM1.88 million Shorefront unit rented for RM5,500 gives roughly 3.5%. A smaller unit costing around RM660,000 and renting for RM2,300 gets above 4%.

Those are gross figures. Maintenance fees, sinking-fund contributions, vacancies, repairs, furnishing, assessment and agent fees all come out afterward.

We would prefer a central George Town unit approaching 4% gross yield before counting on capital appreciation. Once the starting yield drops toward 2.5% or 3%, the buyer is making a much bigger bet on scarcity and future resale value.

These are indicative comparisons between recent asking rents and asking or transacted prices rather than matched purchase-and-tenancy records.

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Is medical tourism really helping George Town property?

Medical tourism is one of the strongest real demand engines behind central George Town property right now because patient numbers are already large and still growing quickly.

According to figures presented by the Penang state government from the Penang Centre of Medical Tourism, 16 participating private hospitals received 527,176 foreign patients in 2025, compared with 418,608 in 2024. That is an increase of almost 109,000 people, or 25.9%, in a single year.

Revenue moved almost exactly in line with patient volumes, climbing from RM898.1 million to roughly RM1.14 billion, up 26.6%.

That demand is especially relevant around George Town because the city and nearby Pulau Tikus contain a dense cluster of private hospitals. Medical visitors also behave differently from ordinary tourists. Many arrive with relatives, stay for several nights or weeks and care about kitchens, pharmacies, food, transport and proximity to a hospital.

This gives areas around Macalister Road, Jalan Sultan Ahmad Shah and Pulau Tikus a demand base that goes beyond holiday tourism. We would place much more value on being genuinely close to the medical cluster than on a vague claim that a property is "near George Town."

Is George Town tourism still strong enough to support property demand?

George Town still benefits from a huge tourism economy, and recent visitor numbers give us little reason to think that demand is fading.

Tourism Malaysia recorded about 8.77 million guests in Penang's paid accommodation in 2025, up from roughly 8.24 million a year earlier. Around 3.47 million were international guests.

A visitor economy of that size supports far more than hotel rooms. It keeps restaurants, cafés, retail, heritage businesses and transport services busy, while making central George Town a more attractive place to live and own property.

The important change for property investors is how they can capture that demand. Ordinary residential condo owners on Penang Island now face far tighter short-stay rules, so strong tourism can no longer be turned automatically into Airbnb income.

We would treat tourism as support for George Town's broader desirability and commercial activity. For a residential investment, long-term and medium-term tenant demand still needs to make sense on its own.

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Can you still buy a George Town condo and run it as an Airbnb?

An ordinary residential strata condo in George Town can no longer be treated as an Airbnb investment under Penang Island's current short-stay rules.

Penang's Private Homestay by-law has now come into force, giving the local councils a formal licensing and enforcement framework for private short-term accommodation. Under the Penang Island City Council rules, strata properties classified as residential are prohibited from operating as private short-term accommodation.

Commercially classified properties have a different route. Serviced apartments, SOHO units, shops, shophouses and some other commercial formats can potentially qualify, although operators still need to satisfy licensing, planning and management requirements.

The rules also require approval from the relevant Joint Management Body or Management Corporation where applicable. A special resolution generally needs support from at least 75% of valid votes. Licensed operators then face application, licence and annual operating fees.

This is one of the biggest recent changes to the George Town investment case. We would value an ordinary residential condo using normal residential rent. Any salesperson presenting Airbnb projections for that type of property now needs to explain exactly how the operation would be legal.

A serviced residence can still be interesting, but we would verify the title, approved use, management rules and licence eligibility before including short-stay revenue in our calculations.

Will the Mutiara LRT push George Town property prices higher?

The Mutiara LRT should make central George Town more useful and better connected, but we would not pay a large LRT premium today for benefits that are still years away.

The current MRT Corp plan covers about 29.7 kilometres between Silicon Island and Penang Sentral, passing through Komtar, with 22 stations plus two provisional stations. Construction is already underway and passenger service is expected toward the end of 2031.

For George Town, Komtar is the critical station. MRT Corp currently estimates that the trip from Silicon Island to Komtar will take around 45 minutes. The full line will also cross to Penang Sentral, linking the island more directly with the mainland rail and transport network.

That could matter a lot over the next decade. George Town would gain a fixed-rail link to the southern employment and development corridor, while workers, visitors and residents would become less dependent on road travel.

Still, five years of construction, execution risk and changing property supply sit between today and the planned opening. A good George Town property should already make sense at its current price. The railway can improve the investment rather than rescue it.

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Is Pulau Tikus or Gurney a safer buy than central George Town?

Pulau Tikus and Gurney look safer today for buyers who care about established residential demand, while central George Town often works better for smaller units and tenants who want hospitals, food and walkability.

Gurney sits at the expensive end of the market. Large Gurney Paragon units have recently changed hands above RM1,000 per sq ft, and asking rents frequently run from around RM7,000 to RM10,000. Buyers there are paying heavily for established prestige, large layouts and location.

Pulau Tikus gives buyers a much wider choice. Recent non-landed transactions have produced a median around RM680,000 and RM576 per sq ft, while new developments such as Codrington Residence enter the market at prices well above RM1 million.

Central Macalister has a different renter. Smaller serviced units can deliver better rent-to-price ratios and benefit directly from nearby hospitals, restaurants and the heritage district.

We would lean toward Pulau Tikus or Gurney for a large unit intended for long-term owner-occupiers and wealthier tenants. For a smaller investment unit, Macalister and selected central George Town projects can produce better rental mathematics.

Are George Town heritage shophouses a better investment than condos?

A good George Town heritage shophouse can be far more scarce than a condo, but buying one requires considerably more work and a clear plan for how the building will make money.

The investment appeal is easy to understand. New heritage shophouses cannot simply be created inside the UNESCO core. A well-located building can attract retailers, restaurants, offices, boutique hospitality operators or buyers who value the architecture itself.

The building can also become expensive very quickly. Roofs, timber structures, drainage, fire requirements and structural repairs can cost far more than expected. Conservation rules restrict what an owner can change, and significant work may require planning approval or a Heritage Impact Assessment.

Commercial vacancy is another risk. A reasonably priced apartment can appeal to a broad pool of tenants. A specialist shophouse may need exactly the right restaurant, hotel or retail operator.

We would choose the shophouse when the location is exceptional, the building condition is understood and the intended use is already clear. Buyers looking for a passive rental property will usually find a well-chosen condo easier to manage.

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Is George Town property still attractive for foreign buyers?

George Town has become much harder to justify for foreign buyers unless the property is good enough to hold for many years.

The biggest new hurdle is acquisition tax. Malaysia now applies an 8% stamp duty rate to residential property transfers involving non-citizens who are not permanent residents. On a RM1 million home, that is RM80,000. A RM2 million purchase creates RM160,000 of transfer duty before legal fees and other acquisition costs.

Foreign buyers on Penang Island also generally face a RM1 million minimum price for strata residential property, while eligible landed purchases typically face a much higher threshold. State consent is required, and the Penang Land and Mines Office currently lists a RM10,000 processing fee for an individual foreign residential application.

Leaving the investment quickly is expensive as well. Malaysia's current Real Property Gains Tax schedule charges non-citizens and non-permanent residents 30% of the chargeable gain when they sell within the first five years. From the sixth year onward, the rate is 10%.

Those costs destroy much of the logic behind short-term flipping. A foreign buyer paying 8% simply to enter the property needs either strong rental income, a very attractive purchase price or enough time for capital appreciation to absorb the friction.

For us, seven to ten years now feels like a much more sensible foreign-buyer horizon in George Town.

Could George Town property struggle even while Penang's economy grows?

Yes. George Town property can easily underperform Penang's economy if buyers keep adding money to average condos while new housing supply keeps expanding elsewhere.

Penang's major growth engines are spread across the state. Semiconductor and industrial investment remains heavily concentrated around Bayan Lepas and Batu Kawan. Silicon Island creates another major development area in the south. The future LRT will eventually make those employment centres easier to reach without living in central George Town.

Meanwhile, Penang has already added roughly 33,000 high-rise units since 2021. As seen above, annual high-rise transactions have fallen from 4,240 in 2023 to 3,354 in 2025.

Economic growth alone cannot justify paying a premium for every George Town apartment. The property still needs a reason for people to choose it over hundreds of alternatives.

Hospital access is one reason. A true waterfront position is another. Walkability, heritage character, a rare large layout or a compelling purchase price can also create that edge.

If the entire sales pitch boils down to "Penang is growing," we would keep looking.

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What return can you realistically expect from George Town property now?

A sensible George Town investment today is more likely to deliver a few percentage points of rental yield plus moderate long-term appreciation than another dramatic property boom.

For many investable central units, we would aim for roughly 3% to 4.5% gross long-term yield. Smaller well-bought units can reach the upper end of that range. Expensive Gurney and waterfront condos can easily fall into the high-2% or low-3% range.

Net income will be lower after maintenance, sinking fund payments, repairs, vacancy, assessment, quit rent, agent fees and furnishing.

We would also keep appreciation assumptions modest. Recent Penang transaction data give us no basis for assuming 7% or 8% annual price growth across the market. A deal that works with 2% to 3% nominal annual appreciation is far more convincing.

That gives the buyer several ways to win. Rent produces some return immediately, while medical tourism, heritage scarcity, infrastructure and long-term growth can add to capital values over time. If the investment requires a huge future price jump to look acceptable, we would pass.

So, is George Town property still worth buying?

Yes, George Town property is still worth buying today, but we would only buy properties with a clear advantage over the growing amount of competing stock.

The weaker parts of the market are easy to identify. Penang has added roughly 33,000 high-rise units since 2021, completed unsold homes remain elevated, high-rise transaction activity has fallen since 2023 and many luxury condos produce gross yields around 3%. Foreign buyers also face a much heavier 8% acquisition duty, while ordinary residential condos on Penang Island can no longer be underwritten as Airbnb properties.

Against that, George Town still has demand that most Malaysian cities would struggle to reproduce. Penang received more than 8.7 million paid-accommodation guests in 2025. Foreign medical-patient visits jumped almost 26% to more than 527,000. The UNESCO core restricts new development permanently. Selected prime projects still command more than RM1,000 per sq ft. The Mutiara LRT is now under construction and should eventually connect Komtar directly with the island's southern growth corridor and Penang Sentral.

We would buy George Town for a seven-to-ten-year horizon when the numbers already work reasonably well today. Smaller central units approaching a 4% gross long-term yield deserve attention. So do genuinely scarce waterfront properties, well-located homes around the medical cluster and heritage assets bought with a realistic operating plan.

We would walk away from interchangeable new condos priced mainly on future appreciation, residential units sold with questionable Airbnb projections, and luxury properties where a sub-3% yield leaves the buyer dependent on someone paying an even higher price later.

George Town still deserves a place on a property investor's shortlist. These days, the opportunity sits in individual assets rather than in the citywide market. Buying the right George Town property can still work very well. Buying the postcode alone is no longer enough.

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Who is the author of this content?

BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Penang. If you’d like to learn more about us, you can check our presentation page.