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Is Kuala Lumpur’s condo market oversupplied?

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SUMMARY

Yes. Kuala Lumpur’s condo market is oversupplied today, especially once completed serviced apartments and the next wave of high-rise supply are included.

The clearest evidence is already-completed stock. Kuala Lumpur has 3,733 residential overhang units and another 4,181 completed unsold serviced apartments, leaving close to 8,000 finished units still searching for buyers.

The problem is not simply leftover inventory from an old boom. Almost half of Malaysia’s current residential overhang comes from projects five years old or younger, which means the market is still creating fresh unsold stock.

Serviced apartments make the picture considerably worse because they often compete with ordinary condos for the same tenants and investors. Kuala Lumpur already had roughly 143,600 existing serviced-apartment units by H1 2025, and developers are still adding more.

The pipeline remains the bigger medium-term risk. Kuala Lumpur and Selangor together have more than 245,000 non-landed units identified in the development pipeline through 2029, so ordinary high-rises will face plenty of new competition even if some projects are delayed.

Oversupply has not produced a broad price collapse. Instead, it is showing up through weak high-rise appreciation, longer resale periods, stronger developer incentives and limited rent growth while better buildings continue to transact.

That explains the strange split in the market. Prime Kuala Lumpur property can attract record transaction activity at the same time that thousands of completed units remain unsold elsewhere.

The most exposed properties are large investor-oriented projects with hundreds or thousands of similar small units. MRT access and modern facilities help, but they offer much less protection when several nearby towers are selling the same basic product.

The buildings coping best tend to have something harder to copy: an established expatriate tenant pool, strong owner-occupier demand, a genuinely scarce location, good schools, walkability or a neighbourhood ecosystem that tenants actively choose.

For buyers, oversupply is useful because it creates negotiating power. But the real advantage is not getting a discount; it is being able to reject ordinary projects without worrying that another suitable unit will disappear.

The bigger risk from here is several years of weak pricing power rather than a sudden Kuala Lumpur-wide condo crash. There are still good condos to buy, but generic high-rise property now needs an unusually attractive price to justify the competition it will face.

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Why does Kuala Lumpur feel so oversupplied right now?

Kuala Lumpur really does have an oversupply problem today, and the amount of completed property still waiting for buyers is too large to dismiss as an old reputation.

NAPIC counted 3,733 completed residential units in Kuala Lumpur as overhang in Q1 2026. These are completed homes that have remained unsold for more than nine months after launch.

Serviced apartments add another 4,181 completed unsold units in Kuala Lumpur. Official statistics put serviced apartments in a separate category, but investors looking for a small urban property often compare them directly with condominiums.

That gives us close to 8,000 completed residential and serviced-apartment units still looking for buyers in Kuala Lumpur. We cannot treat every one of those units as directly comparable, but the scale is large enough to confirm that the supply problem is real.

The national trend has also moved in the wrong direction lately. Residential overhang reached 32,801 units in Q1 2026, up from 23,515 one year earlier, an increase of roughly 40%. Kuala Lumpur had the fourth-largest residential overhang among Malaysian states and federal territories.

So when people say Kuala Lumpur has too many condos, they are picking up on something real. The mistake is applying that observation equally to every building in the city.

Measure Latest figure Comparison What it tells us
Kuala Lumpur residential overhang 3,733 units Fourth-highest in Malaysia Large stock of completed unsold homes
Kuala Lumpur serviced-apartment overhang 4,181 units Second only to Johor Adds another major pool of high-rise inventory
Combined KL completed unsold stock Nearly 8,000 units Residential + serviced apartments Better sense of the competitive stock investors see
Malaysia residential overhang 32,801 units About +40% YoY The national overhang problem has recently worsened
Malaysia serviced-apartment overhang 19,263 units Up from 18,752 in Q4 2025 Serviced apartments remain particularly difficult to clear

What does “oversupplied” actually mean for Kuala Lumpur condos?

Kuala Lumpur is oversupplied when comparable condos are arriving faster than buyers and tenants can comfortably absorb them at the prices developers and owners want.

Counting cranes or towers alone tells us very little. Kuala Lumpur is a dense capital city, so having a lot of apartments is normal.

Completed unsold stock gives us a much harder test. If a project has already been finished and units are still unsold more than nine months later, demand clearly failed to match the original supply at the offered price.

Units still under construction require more caution. A tower that is 60% sold two years before completion may eventually clear. A tower with weak sales six months before handover creates a much more immediate problem.

Future projects are even less certain because developers can delay launches, change unit mixes or postpone construction.

That distinction is important when enormous pipeline numbers get quoted. Kuala Lumpur has a genuine problem with completed inventory today, while the pipeline tells us how much harder absorption could become over the next few years.

We therefore need to judge oversupply building by building and neighbourhood by neighbourhood, while keeping the citywide inventory in the background.

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Are serviced apartments making Kuala Lumpur’s condo glut much worse?

Yes. Kuala Lumpur’s serviced apartments materially increase the amount of high-rise property chasing the same investors and tenants.

NAPIC counted 4,181 completed unsold serviced apartments in Kuala Lumpur in Q1 2026. Across Malaysia, the figure reached 19,263 units worth RM16.52 billion.

The price distribution makes the problem more interesting. About 58.5% of Malaysia’s completed unsold serviced apartments sit between RM500,001 and RM1 million.

That is an awkward range. It sits above the very affordable segment where Malaysian transaction volumes are deepest, while remaining cheap enough for developers to build hundreds or even thousands of fairly similar investment units.

For buyers, the official label often matters less than the practical product. A 550 sq ft serviced apartment near an MRT station may compete directly with a 600 sq ft condominium nearby for the same young professional or investor.

Kuala Lumpur already had an enormous installed base before this latest overhang appeared. NAPIC recorded roughly 143,600 existing serviced-apartment units in the city by H1 2025.

There is also fresh evidence that developers have not abandoned the format. Kerjaya Prospek Property said in its latest annual report that it has about RM2 billion of serviced-apartment developments planned across Kuala Lumpur, Selangor and Penang over the next one to two years. A 74-storey serviced-apartment project at Jalan Pavilion also moved into foundation works this year.

Serviced apartments remain a central part of Kuala Lumpur’s supply story.

Serviced-apartment measure Figure Why we care
Existing KL stock, H1 2025 About 143,600 units Huge established high-rise base
Completed unsold KL units 4,181 Finished stock still searching for buyers
Completed unsold Malaysia units 19,263 Problem extends well beyond KL
Value of national unsold stock RM16.52 billion Large amount of capital tied up
Share priced RM500k-RM1m 58.5% Oversupply is concentrated in a major investor price band

Is Kuala Lumpur still building too many condos?

Yes. Kuala Lumpur and the wider Klang Valley still have enough high-rise construction coming to keep pressure on ordinary condos for years.

The latest EdgeProp EPIQ pipeline study gives a useful scale. Selangor and Kuala Lumpur together have 889 private residential developments in the pipeline through 2029, representing 245,575 non-landed units and only 34,082 landed homes.

That means roughly 88% of the identified future units across the two markets are non-landed.

Looking across the Klang Valley, Johor and Penang, EdgeProp found 393,381 residential units scheduled to come onstream between 2026 and 2029. About 84% are high-rise.

This is much fresher than relying only on launches announced several years ago because the dataset covers projects currently at different stages of construction.

Individual developments can also be huge. Pitta Residences has 1,168 units. KL48 has around 1,700. Sunway Velocity 3 has 1,604. Amaya Residences at Bandar Sri Damansara, where construction is now under way, will add another 1,268 residences.

Four developments of that size already represent almost 5,800 units.

The problem gets sharper when several projects target similar tenants within the same catchment. An MRT station can generate demand, but developers know that too. Connectivity often attracts more towers until the original scarcity starts disappearing.

Pipeline measure Latest indication What stands out
Selangor + KL pipeline developments through 2029 889 Huge number of projects still progressing
Non-landed units 245,575 High-rises dominate future supply
Landed units 34,082 Small share of the pipeline
Non-landed share About 88% Future competition remains overwhelmingly vertical
Amaya Residences 1,268 units Large MRT-linked project already under construction
KL48 About 1,700 units One tower cluster can materially change local supply
Sunway Velocity 3 1,604 units Large additions are occurring in established high-rise areas too

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If Kuala Lumpur has too many condos, why are buyers still buying them?

Kuala Lumpur still has plenty of real housing demand; the oversupply problem shows up in how selective buyers have become, not in buyers disappearing.

Malaysia recorded RM108.27 billion of residential transactions in 2025. JLL’s latest Kuala Lumpur research also found that prime residential transactions reached an all-time high during the year.

That is hard to reconcile with the idea that people have broadly stopped wanting Kuala Lumpur property.

What has changed is where money goes.

JLL describes a market increasingly divided between high-quality assets and everything else. Buyers are concentrating more heavily on better projects, stronger locations and higher-priced prime property.

The developers themselves provide another useful clue. Mah Sing recorded RM2.51 billion of property sales in 2025, its strongest annual result in a decade, and is targeting RM2.76 billion this year. Its active Kuala Lumpur projects include Setapak, Kepong, Cheras, Sentul and Old Klang Road.

A city where nobody wants apartments could not produce that level of sales.

At the same time, NAPIC is recording thousands of completed unsold homes.

Both can happen at once. Kuala Lumpur has buyers, but buyers now have enough choice to leave mediocre stock sitting on the market.

Are Kuala Lumpur condo prices falling because of oversupply?

Kuala Lumpur condo prices are holding up much better than the overhang numbers would suggest, although high-rise appreciation remains weak.

The national figures give us a useful benchmark. Malaysia’s House Price Index rose 2.6% in 2025, but high-rise homes increased by only 0.6%.

Terraced houses rose 3.3%, semi-detached homes 2.8% and detached homes 2.4%.

That gap is revealing. High-rises were still appreciating, but much more slowly than every major landed category.

The first quarter of 2026 showed some improvement, with national high-rise prices up 1.3% year on year. That still falls well short of anything resembling a boom.

Kuala Lumpur transaction data also shows huge variation from building to building. Brickz recorded more than 3,000 KL condominium transactions over the twelve months to mid-2026, with a median near RM700,000. The gap between lower-priced and prime transactions remains enormous.

For owners, oversupply is showing up through slow appreciation, long resale periods and strong competition from newer projects more than through a dramatic citywide price drop.

A good building can appreciate while a neighbouring one stagnates. These days, the Kuala Lumpur average hides almost as much as it reveals.

Property type 2025 Malaysia price growth What it suggests
Terraced houses +3.3% Strongest major housing category
Semi-detached +2.8% Landed demand remained healthier
Detached +2.4% Also outpaced high-rises
High-rise +0.6% Clear relative weakness
Overall MHPI +2.6% High-rises badly lagged the broader market

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Are Kuala Lumpur rents starting to crack?

No broad rental crack is visible yet in the better Kuala Lumpur condo markets.

Prime rental data has remained surprisingly resilient considering how much housing exists.

Knight Frank’s recent Kuala Lumpur residential tracking showed broadly stable rental ranges in KL City and Mont’ Kiara, while Bangsar, Bangsar South, KL Sentral and Seputeh recorded modest increases. Cochrane, Chan Sow Lin and Maluri also moved higher.

NAPIC’s full-year property report reached a similar conclusion from a wider dataset. It highlighted monthly rents above RM11,000 for luxury projects including U Thant Residence, Seni Mont Kiara and Sunway Vivaldi.

Those are premium examples, but they show that tenants will still pay heavily for the right property.

The weaker point is rental growth. Even property-sector analysts expecting reasonable demand this year have warned that rental increases in many segments may struggle to beat inflation.

That makes sense in a supply-heavy city. Landlords can keep apartments occupied while still finding it difficult to raise rents because tenants have plenty of alternatives.

For investors, stable occupancy and strong rent growth are two different things. Kuala Lumpur currently has more evidence for the first than the second.

Can tenant demand absorb all the condos Kuala Lumpur is building?

No. Kuala Lumpur has enough tenants to support a large condo market, but current demand does not look strong enough to absorb every new high-rise without some buildings losing out.

Kuala Lumpur remains Malaysia’s main employment centre, and the wider Klang Valley keeps attracting professionals, students, expatriates and smaller households.

High-rise living also fits the way the city is changing. In an April 2026 review of Klang Valley housing, EdgeProp identified 30 upcoming non-landed developments priced between RM500,000 and RM1 million due for completion from 2026 through 2028. Property consultants interviewed for the study pointed specifically to professionals, couples and small families as the core owner-occupier groups.

That demand is real.

The difficulty comes from substitution. A tenant looking around Setapak, Sentul, Cheras or Old Klang Road may have dozens of buildings within the same budget. Someone working near the city centre can also choose Petaling Jaya, Ampang, Subang Jaya or other parts of Selangor.

Foreign buyers provide additional demand in KLCC, Bukit Bintang, Mont’ Kiara, TRX and other internationally recognisable locations, but they remain too small a group to clear the entire market. In 2025, non-citizens accounted for only about 5% of Malaysian residential transaction value according to NAPIC’s buyer breakdown.

So Kuala Lumpur has a deep pool of potential residents, but developers have built an equally deep pool of alternatives.

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Is Kuala Lumpur’s condo overhang just leftover junk from the last boom?

No. Old projects explain a large part of Malaysia’s overhang, but newer projects are now contributing too.

NAPIC breaks residential overhang down by project age.

In Q1 2026, 13,429 overhang units nationally came from developments launched six to ten years earlier. Another 3,437 came from projects more than ten years old.

Those older developments together represent just over half of the total.

But 9,436 unsold completed units came from projects less than three years old, while another 6,499 were three to five years old.

So almost half of the current residential overhang comes from projects five years old or younger.

That changes the interpretation. Malaysia is still clearing mistakes made during the previous development cycle, but the market is also creating fresh unsold stock.

Kuala Lumpur buyers therefore cannot assume that every modern launch will avoid the problems seen in older projects.

Project age Residential overhang Share of total
Under 3 years 9,436 units 28.8%
3-5 years 6,499 19.8%
6-10 years 13,429 40.9%
More than 10 years 3,437 10.5%
Total 32,801 100%

Are Kuala Lumpur developers finally pulling back?

Yes, developers have become noticeably more cautious lately, although the projects already in the system will keep producing new condos for years.

Malaysia recorded 64,487 new residential launches in 2025, down 14.9% from 75,784 in 2024.

Kuala Lumpur itself launched 6,663 residential units during 2025.

The slowdown became much sharper in Q1 2026. Only 9,112 residential units were launched nationally, compared with more than 12,000 one year earlier, and the initial sales rate fell to just 11.5%.

Construction starts also dropped dramatically. New residential starts fell to 8,243 units from more than 28,000 in the same quarter a year earlier.

Serviced-apartment starts fell by more than 40%.

Developers have clearly seen the same inventory figures we have.

The catch is that planned supply started climbing again. Planned residential developments increased by more than 50% to 12,852 units during Q1, while planned serviced apartments rose from 4,024 to 6,961 units.

So this looks more like a pause in immediate construction than a clean end to the building cycle.

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Are cheaper Kuala Lumpur condos fixing the oversupply problem?

Cheaper prices are helping developers reach more buyers, but they are also concentrating even more projects in the same mid-market segment.

The shift is obvious in the latest pipeline data.

EdgeProp found that the RM250,000-RM499,000 price band represents 48.9% of incoming Klang Valley non-landed supply this year, up from only 13.3% in 2025.

For 2027, the share is expected to settle around 28.8%, followed by 31.7% in 2028.

The RM500,000-RM749,000 segment is also growing strongly, from 16.6% of incoming high-rise supply currently to 32.8% in 2027.

Developers have clearly worked out that RM1 million-plus investor apartments are harder to sell in huge volumes.

Mah Sing’s latest launches illustrate the strategy. Its upcoming M Aurora serviced residence on Old Klang Road starts around RM468,800, while the company continues pushing mass-market projects in Setapak, Sentul and other dense urban corridors.

Moving prices down improves affordability, but it creates another problem: a lot of developers are now chasing the same RM400,000-RM700,000 buyer.

The affordable end can become crowded too.

Which Kuala Lumpur condos are most exposed to oversupply?

Generic investor condos with hundreds of near-identical units face the highest oversupply risk in Kuala Lumpur right now.

The pattern is fairly easy to recognise.

Large towers create many landlords at the same moment. Small layouts attract similar tenants. Nearby developments offer similar pools, gyms, co-working spaces and MRT access. Once several projects complete together, landlords end up competing mostly on rent.

Consider what a 1,500-unit development means after handover. Even if only one-third of the apartments are rented out, that creates 500 potential landlords inside a single project.

Add two nearby projects and a tenant can suddenly compare hundreds of units without changing neighbourhood.

This is why unit count matters almost as much as location.

MRT access helps, but a station surrounded by six new residential towers can become very competitive. A developer brand helps, but it cannot prevent identical units from appearing on the secondary market. A low launch price helps initially, yet it offers little protection once the next project launches at a similar price.

We would be most careful with small investor-oriented units in districts where several large projects are completing within the same two- or three-year window.

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Which Kuala Lumpur condos are handling the supply best?

Kuala Lumpur condos with a real reason for people to choose that specific building are holding up much better than generic high-rise stock.

Mont’ Kiara is a useful example. The neighbourhood has a huge number of condos, yet it also has a deep expatriate tenant base, international schools and an established residential ecosystem. Prime rents have remained broadly stable.

Desa ParkCity works differently. The area benefits from parks, retail, schools, walkability and a controlled master-planned environment that is difficult to replicate somewhere else.

Bangsar has scarcity on its side. There is plenty of Greater Kuala Lumpur housing, but far fewer properties can reproduce Bangsar’s mix of location, restaurants, employment access and established low-density neighbourhoods.

At the luxury end, JLL’s latest research shows buyers becoming more concentrated in prime Kuala Lumpur assets. Prime transactions reached a record level in 2025 even while the wider Malaysian market became more selective.

This flight to quality is probably the most useful way to think about Kuala Lumpur now. Too much supply does not affect every building equally because the supply of genuinely desirable properties is much smaller than the headline condo count.

Are new Kuala Lumpur condos hurting older buildings?

Yes. New supply is quietly making life harder for older Kuala Lumpur condos even when the new projects themselves sell reasonably well.

This is one of the easier effects of oversupply to miss.

A newly completed development arrives with fresh interiors, newer facilities, EV chargers, smart-home features, impressive common areas and developer marketing. Older buildings nearby suddenly have to compete with it for both tenants and buyers.

The numbers can become large very quickly.

Take three new developments with 1,000 units each. If 40% of those units enter the rental pool, the neighbourhood gets another 1,200 rental listings over time.

An older condominium does not need to become empty for that competition to hurt. Its landlord may have to accept RM2,800 instead of RM3,100, spend more on renovation or wait an extra month for a tenant.

The same happens in resale. A five-year-old owner trying to sell for RM750,000 may be competing with a developer offering a brand-new unit for RM780,000 plus furnishing packages, legal-fee support and financing incentives.

Kuala Lumpur’s supply problem therefore spreads beyond the projects officially classified as overhang.

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Is Kuala Lumpur condo oversupply actually good for buyers?

Yes, Kuala Lumpur’s oversupply currently gives patient buyers more negotiating power than they would have in a tight market.

Nearly 8,000 completed unsold residential and serviced-apartment units already give buyers plenty of alternatives before we even count ordinary resale listings.

The future pipeline adds another layer of competition.

That puts pressure on developers to use rebates, furnishing packages, absorbed legal fees, flexible payment arrangements and other incentives. Resale owners also have to compete with those deals.

But a discount only helps if the underlying property is good.

Buying a RM700,000 condo for RM620,000 can still be a poor deal if five nearby projects will deliver 5,000 similar apartments before you want to resell.

The strongest position for a buyer today is to use oversupply as permission to walk away. Compare actual completed transactions, real achieved rents, maintenance fees, vacancy in the building and the local completion pipeline.

Kuala Lumpur has enough inventory that buyers rarely need to force a decision on an ordinary property.

Could Kuala Lumpur’s condo oversupply get much worse?

Yes. Kuala Lumpur’s condo oversupply could still worsen because the city is entering the next few years with both a large existing overhang and a huge high-rise pipeline.

As seen above, completed residential overhang nationally has already risen roughly 40% in a year, while Kuala Lumpur alone has close to 8,000 completed unsold residential and serviced-apartment units.

At the same time, Kuala Lumpur and Selangor have more than 245,000 non-landed units in the private residential pipeline through 2029 according to the latest EdgeProp EPIQ study.

That does not mean 245,000 unwanted condos will suddenly appear. Selangor is included in the figure, projects complete at different times, and some will sell extremely well.

Still, high-rise supply remains heavy.

The encouraging part is that developers have slowed launches and construction starts dramatically this year. Buyers are also still transacting, good rental markets remain active and prime property continues attracting capital.

A serious downturn would probably require those supports to weaken at the same time: slower employment, weaker household confidence and a large completion wave would be a particularly bad combination.

For now, our bigger concern is several years of weak pricing power in ordinary buildings rather than a sudden Kuala Lumpur-wide condo crash.

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So, is Kuala Lumpur’s condo market oversupplied?

Yes. Kuala Lumpur’s condo market is oversupplied today, especially once serviced apartments and the next wave of high-rise completions are included.

The evidence has become stronger lately.

Kuala Lumpur has 3,733 completed residential overhang units and another 4,181 unsold serviced apartments. National residential overhang has risen roughly 40% year on year. High-rises appreciated only 0.6% nationally in 2025, far behind landed homes. Kuala Lumpur and Selangor still have more than 245,000 non-landed units moving through the development pipeline to 2029.

Those figures are too substantial to wave away.

Yet the market is clearly sorting properties rather than rejecting condos altogether. Prime Kuala Lumpur transactions reached record levels in 2025 according to JLL. Developers such as Mah Sing are still producing strong sales. Rents in established locations such as Mont’ Kiara, Bangsar and parts of central Kuala Lumpur remain resilient.

That tells us where the real problem sits.

Kuala Lumpur has built too many condos that are easy to replace with another condo.

A tower with 1,000 similar investment units, surrounded by several new projects and offering nothing rare beyond a pool and an MRT station, now needs an unusually attractive price to make sense. Buildings with strong owner-occupier demand, scarce locations, established tenant pools or genuinely better living environments have much more protection.

So we would treat oversupply as a permanent part of the Kuala Lumpur buying equation for now. It should make buyers much more demanding about price, unit count, nearby completions and resale competition.

There are still good Kuala Lumpur condos to buy. The average one deserves far more scrutiny than it used to.

OUR METHODOLOGY

This analysis tests whether Kuala Lumpur’s condo market is genuinely oversupplied based on the amount of completed property already struggling to sell, the scale of incoming high-rise supply, buyer absorption, price performance, rental behaviour and the response from developers.

We gave the most weight to completed overhang because those units have already reached the market and remained unsold under NAPIC’s official definition. Pipeline figures are used differently: they tell us how much additional competition may arrive, but we do not assume that every planned or under-construction unit will eventually become excess stock.

Serviced apartments are kept separate from residential overhang when quoting official statistics, but we include them in the broader competitive picture where they function as close substitutes for condominiums. That is particularly relevant in Kuala Lumpur, where smaller serviced apartments and condos often target the same investors and tenants.

We also tested the oversupply argument against evidence that could weaken it. Prime transaction activity, rents in established neighbourhoods, developer sales and the slowdown in launches were considered alongside the inventory figures. High-rise price performance was compared with landed housing to see whether weakness was concentrated in the segment facing the heaviest supply.

At property level, we focused on how replaceable a condo is. Unit count, nearby completions, tenant depth, owner-occupier appeal, connectivity, achieved rents, pricing and genuine neighbourhood scarcity all affect whether a building is likely to cope with a supply-heavy market better than the citywide numbers suggest.

We prioritized official NAPIC and JPPH statistics for overhang, stock, launches, construction starts, planned supply, transaction activity and house-price performance. We then used established property-market research and primary company disclosures for rental trends, project pipelines, developer sales and individual development sizes.

Key sources used for this analysis include: NAPIC / JPPH’s Q1 2026 Property Market press release, NAPIC / JPPH’s Q1 2026 Property Market Snapshot, NAPIC / JPPH’s Property Market Report 2025, the Malaysian House Price Index 2025, JLL’s Kuala Lumpur housing research, Knight Frank Malaysia’s Real Estate Highlights 2026, EdgeProp EPIQ’s 2026 pipeline study, Mah Sing Group’s Integrated Report 2025, Sunway Property’s Sunway Velocity 3 project disclosure, KL48’s official project disclosure, Kerjaya Prospek Property’s serviced-apartment pipeline disclosure reported by EdgeProp, and The Edge Malaysia’s reporting on Amaya Residences.

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