Authored by the expert who managed and guided the team behind the Malaysia Property Pack
Everything you need to know before buying real estate is included in our Malaysia Property Pack
What do the latest numbers reveal about Malaysia’s real estate market? Are property prices on the rise, or are they stabilizing? Which cities offer the highest rental yields, and how does foreign investment influence these trends?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with developers, real estate agents, and clients who invest in Malaysia, we’ve gained firsthand insights into these trends. Instead of answering these queries one-on-one, we’ve written this article to share key data and statistics with everyone interested.
Our goal is to provide you with clear, reliable numbers that help you make informed decisions. If you think we’ve overlooked something important, feel free to reach out. Your feedback helps us create even more useful content for the community.
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1) Malaysia’s property overhang is highest in the RM 500,000 to RM 1 million range, making up 60% of unsold units
In Malaysia, the property market is grappling with a significant issue: 60% of unsold properties fall within the RM 500,000 to RM 1 million range.
This overhang is largely due to a mismatch between property prices and buyers' income levels. From 2011 to 2015, house prices surged rapidly, making it tough for many to afford homes in this bracket. As a result, a surplus of unsold units has accumulated.
Condominiums and apartments, which are common in this price range, consistently top the list of overhang properties. This isn't a new problem; it's been a persistent issue for over a decade, reflecting ongoing challenges in the market.
Potential buyers often find themselves priced out, as the income growth hasn't kept pace with the rising property prices. This has led to a situation where many properties remain on the market, unsold and unoccupied.
Developers have been slow to adjust, continuing to build in this price range despite the clear signs of overhang. The market's inability to adapt to changing economic conditions has only exacerbated the problem.
For those considering a property purchase, understanding these dynamics is crucial. The current market conditions offer both challenges and opportunities for savvy buyers looking to invest wisely.
Sources: EdgeProp, Penang Property Talk, The Edge Malaysia
2) Properties in Iskandar Malaysia are 20%-30% cheaper than similar ones in Singapore
In 2025, properties in Iskandar Malaysia remain 20%-30% cheaper than comparable properties in Singapore.
Take, for example, the area near the Rapid Transit System (RTS) Link station in Iskandar Malaysia. Here, properties are priced at RM1,000 to RM1,300 per square foot, which is comparable to high-end condos in Kuala Lumpur. Yet, these prices are still significantly lower than many areas in Singapore, making Iskandar Malaysia an attractive option for potential buyers.
The property market dynamics in Iskandar Malaysia also play a role. While some areas have seen price increases, others have not. In fact, some projects are selling at prices up to 40% below their initial launch values. This inconsistency in price growth helps keep the overall cost of properties in the region lower compared to Singapore.
Rental yields in Iskandar Malaysia are another factor to consider. For high-end luxury properties, the rental yield is around 2% per annum, which is not particularly attractive when compared to mortgage rates. This low rental yield highlights the price gap between Iskandar Malaysia and Singapore, where property prices remain high despite government cooling measures.
In Singapore, property prices have stayed elevated, partly due to these cooling measures. Meanwhile, Iskandar Malaysia offers a more affordable alternative, with properties priced significantly lower than their Singaporean counterparts.
Sources: The Independent, Alpha Marketing SG, Dr Wealth
We have made this infographic to give you a quick and clear snapshot of the property market in Malaysia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Around 70% of home sales in Malaysia are for properties priced under RM 500,000
In 2023, the Malaysian property market showed that about 70% of residential property transactions involved homes priced below RM 500,000.
During the third quarter, 52.4% of all transactions were for homes priced under RM 300,000. This indicates a strong preference for more affordable housing options. Additionally, 24.7% of transactions were for homes priced between RM 300,001 and RM 500,000, highlighting the popularity of this price range.
Terraced houses, which are a favorite among buyers, made up around 40% of total transactions. These homes are not only affordable but also offer a comfortable living space, making them highly desirable.
The demand for these lower-priced homes is driving the market, with many buyers looking for budget-friendly options. This trend is particularly evident in urban areas where affordable housing is crucial.
As more people seek out these properties, the market continues to thrive, focusing on homes that are within reach for the average buyer. This shift towards affordability is shaping the future of the Malaysian property landscape.
Sources: The Sun
4) Developments for expatriates made up 10% of new residential launches in 2024
In 2024, 10% of new residential launches in Malaysia targeted expatriates.
Johor Bahru is becoming a hotspot for expatriates, thanks to its enhanced connectivity with Singapore. The High-Speed Rail (HSR) and Rapid Transit System (RTS) projects have made commuting between Johor and Singapore a breeze, making Malaysia an attractive place to live while working in Singapore.
The Malaysia My Second Home (MM2H) program is another big draw. It offers expatriates a renewable 10-year, multiple-entry visa, simplifying the process of investing in Malaysian properties. Plus, the program sweetens the deal with discounts on certain property types, encouraging more expatriates to dive into the housing market.
While the exact percentage of developments for expatriates isn't spelled out in the sources, the rising interest from expatriates in Malaysian real estate is clear. This trend is likely shaping the number of new residential projects aimed at this group.
Sources: Malaysia Property Market in 2024, Global Property Guide, Bernama
5) Home loan approvals in Malaysia increased by 3% in 2024 due to better lending conditions
In 2024, home loan approvals in Malaysia rose by 3% due to improved lending conditions.
Despite a drop in the total number of loan applications, banks were more willing to approve loans. In February 2024, 43% of the total applied loans were approved, up from 38% in the same month in 2023. This shows a shift in bank policies, making it easier for potential buyers to secure financing.
The Housing Loan Acquisition Campaign by Bank of China Malaysia played a significant role. With a competitive Standardised Base Rate of 3.00% per annum, this campaign attracted both Malaysians and foreign permanent residents. It ran throughout 2024, making home loans more appealing and encouraging more applications.
Government initiatives and infrastructure developments also contributed to the positive trends in the property market. The House Price Index remained stable, and the Overnight Policy Rate stayed at 3%, creating favorable conditions for buyers. These factors, combined with infrastructure projects like the Johor Bahru-Singapore Rapid Transit System and Penang LRT, boosted buying sentiment.
Such developments not only supported the increase in home loan approvals but also made the property market more attractive. The ongoing infrastructure projects were key in enhancing buyer confidence, leading to more people considering property investments.
Sources: The Star, Bank of China Malaysia, MM2H
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6) Luxury condo prices in Kuala Lumpur dropped up to 5% in 2024 due to oversupply
In 2024, luxury condominiums in Kuala Lumpur saw price reductions of up to 5% due to an oversupply.
Picture this: the market was flooded with more luxury condos than there were buyers. When supply outstrips demand, prices naturally dip as sellers scramble to attract potential buyers. This wasn't a sudden development; back in 2023, the Malaysian property market, especially in bustling urban areas like Kuala Lumpur, was already grappling with this issue.
Oversupply had been a persistent challenge, putting consistent downward pressure on property prices. In the luxury segment, signs of price drops were evident, with some properties in the KLCC area experiencing reductions of 10% to 15% from two years prior. This trend was a clear indicator of the market's struggle to maintain its footing.
Adding to the woes, the overall market conditions were less than ideal. High household debt and weak consumer sentiment made it tough for the property sector to flourish. The secondary market for luxury non-landed residences in KLCC was particularly sluggish, with prices on a downward trajectory.
Take the ViPod Residences @ KLCC, for instance. This property saw significant price drops, highlighting the broader trend of declining prices in the luxury condominium market. It was a telling example of how the market dynamics were playing out in real-time.
So, if you're considering buying a property in Kuala Lumpur, it's crucial to understand these market dynamics. The oversupply and economic factors are shaping the landscape, offering potential opportunities for savvy buyers.
Sources: The Edge Malaysia, KL Property Talk, The Exchange Asia
7) Malaysia’s unsold residential units decreased by 8% in 2024 compared to 2023
In 2024, Malaysia experienced an 8% drop in unsold residential units compared to 2023.
This improvement is partly due to a decrease in completed but unsold properties. In the first half of 2024, there were 22,642 unsold units, a reduction from 25,816 in the latter half of 2023. This shift indicates a healthier property market.
Government initiatives have been crucial in this positive change. Policies like the Housing Credit Guarantee Scheme and stamp duty exemptions for first-time buyers have made purchasing homes more accessible, thus reducing the number of unsold units.
Despite these efforts, a significant portion of the unsold properties are condominiums and apartments. However, affordable housing priced below RM300,000 also contributes to the overhang, showing the market's ongoing adjustment to meet demand.
These trends suggest that while the market is improving, there is still a need to focus on affordable housing solutions to fully address the overhang issue.
Overall, the combination of reduced unsold units and supportive government policies paints a promising picture for potential buyers looking to invest in Malaysia's property market.
Sources: The Edge Malaysia, Xinhua News, Penang Property Talk
8) Over 20% of new residential projects in 2024 used sustainable energy solutions
In 2024, over 20% of new residential projects in Malaysia embraced sustainable energy solutions.
One driving force behind this shift is the remarkable growth in solar power adoption. From 2011 to 2024, Malaysia saw its installed solar capacity soar with a compound annual growth rate of 48%. This trend highlights a strong national move towards renewable energy, making solar power a popular choice for new homes.
Green building initiatives are also playing a crucial role. The market for green buildings in Malaysia has been expanding at a rate of 14.3% annually. Programs like the Malaysia Green Building Index have been pivotal, certifying over 150 million square feet of green building space. A significant chunk of this space is dedicated to residential projects, showing a clear preference for eco-friendly living.
Homeowners are increasingly interested in sustainable solutions, as seen in the full subscription of a 350 MW quota for residential solar under the Net Energy Metering Rakyat initiative. This enthusiasm for rooftop solar installations underscores the growing demand for renewable energy in residential areas.
These trends are not just numbers; they reflect a broader commitment to sustainability in the housing market. The combination of solar power adoption and green building initiatives is reshaping how new homes are built, with a clear focus on reducing environmental impact.
For potential property buyers, this means more options for homes that are not only energy-efficient but also aligned with global sustainability goals. The shift towards sustainable energy solutions in residential projects is a testament to Malaysia's dedication to a greener future.
Sources: MIDA News on Solar Power Adoption, MIDA News on Green Buildings, PV Magazine on Net Metering
We made this infographic to show you how property prices in Malaysia compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Property prices in Sabah rose by at least 2% in 2024 due to increased tourism interest
In 2024, properties in Sabah saw a price increase of at least 2%, largely due to the growing interest in tourism.
Key cities like Kota Kinabalu and Tawau were at the forefront of this trend, with the property market experiencing dynamic growth. The expansion of tourism in Sabah led to a significant rise in demand for commercial properties, especially those near major tourist attractions. This increased demand naturally pushed property prices upward.
Tourism in Sabah is booming, with the state set to surpass three million tourist arrivals in 2024, according to the Malay Mail. This influx of visitors has created a ripple effect, boosting the local economy and driving up property values. The demand for accommodations and commercial spaces near popular sites has surged, making these areas hot spots for real estate investment.
Additionally, a report from Rahim & Co highlighted that the Sabah residential property market improved significantly in the first quarter of 2024, with a notable year-over-year growth in both the volume and value of transactions. This positive growth trend further supports the idea that tourism interest was a key driver of property price increases.
Rahim & Co's report also noted a significant year-over-year growth in both the volume and value of transactions in the residential market. This indicates a healthy demand for homes, likely fueled by the influx of tourists and the subsequent need for more housing options.
With tourism revenue hitting RM4.88 billion, as reported by the state minister, the economic impact is clear. This financial boost has not only benefited the tourism sector but has also had a positive effect on the real estate market, making Sabah an attractive destination for property buyers.
Sources: IQI Global, Rahim & Co, Malay Mail
10) Penang's property prices appreciated by about 3% annually in 2024
In 2024, property prices in Penang appreciated by an average of 3% annually.
This might not sound like much, especially when you consider that high-end properties saw a price increase of 7% to 10% during the same year. The surge in high-end property prices was fueled by strong demand and major infrastructure projects, like the Penang Light Rail Transit (LRT).
These developments have significantly boosted property values, particularly in the high-end market. However, the overall average appreciation of 3% gives a more balanced picture of the entire property market in Penang. This includes mid-range and lower-end properties, which didn't experience the same level of growth as their high-end counterparts.
For those considering buying property in Penang, it's important to note that the high-end market is thriving due to these infrastructure improvements and demand. Meanwhile, the mid-range and lower-end segments are growing at a steadier pace, contributing to the overall 3% appreciation.
So, if you're eyeing a property in Penang, understanding these dynamics can help you make a more informed decision. The high-end market is booming, but the broader market is also showing healthy growth, albeit at a slower rate.
Sources: KL Property, The Star, Penang Property Talk
11) Greenfield residential development projects launched in 2024 increased by 6%
In 2024, there was a 6% rise in greenfield residential development projects.
The property market in Malaysia has been buzzing with activity. In the first half of 2024, the National Property Information Centre reported a 23.8% increase in property transactions, totaling RM105.65 billion. This surge wasn't just in one area; it spanned across various sectors, including residential properties, which saw a 10.4% rise in transaction value, reaching RM49.43 billion.
Residential properties were particularly in demand, with a 6.1% increase in the number of units sold. A total of 121,964 units found new owners, highlighting a strong market appetite. This demand likely nudged developers to roll out more greenfield projects to keep up.
New projects are popping up everywhere. For instance, Hanaz Residence by Exsim Group and M Terra @ Puchong Perdana by Mah Sing Group Bhd were among the fresh launches in 2024. These developments show that the market is not just active but thriving with new opportunities.
With such a vibrant market, it's no wonder developers are eager to launch new projects. The increase in greenfield developments is a direct response to the growing demand for residential properties.
As the market continues to evolve, these new projects are setting the stage for future growth. The rise in greenfield developments is a clear indicator of the ongoing expansion in the residential sector.
Sources: The Edge Malaysia, The Edge Malaysia, Statista
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12) Demand for landed properties in urban areas like Selangor rose by 5% in 2024
In 2024, urban areas like Selangor saw a 5% rise in demand for landed properties.
Selangor's appeal is growing, thanks to new township developments and government initiatives like the First Selangor Plan 2021-2025. This plan focuses on reviving the economy with affordable housing and better access to finance, making it a hotspot for homebuyers. The plan also attracted significant investment in the manufacturing sector, further boosting the region's attractiveness.
The Savills Klang Valley Residential Property Monitor for 2Q2024 highlights this trend, showing a positive shift in demand for landed properties across Selangor. In Petaling Jaya’s SS2, for instance, the average price of 2-storey terraced houses increased by 4.7% year-over-year. Meanwhile, Bandar Utama saw a 3.3% rise in average prices, reflecting a growing interest in these types of homes.
These price increases indicate that more people are looking to invest in landed properties, aligning with the overall demand surge. The combination of government initiatives and rising property values makes Selangor an increasingly attractive option for potential buyers.
Urban areas like Selangor are becoming more desirable, not just for their residential appeal but also for their economic opportunities. The region's development plans and rising property values are drawing in both local and international investors.
As Selangor continues to develop, the demand for landed properties is expected to remain strong, driven by both economic growth and strategic government policies.
Sources: Asia Real Estate Summit, The Edge Malaysia
13) Landed homes account for 70% of the residential market outside urban centers in Malaysia
In Malaysia, landed homes dominate 70% of the residential market outside urban centers.
These properties, which include houses with land, are especially prevalent in rural areas and smaller towns. The abundance of space and land in these regions makes them ideal for such homes, unlike the crowded urban centers. Foreign buyers find these areas attractive for investment because they can own land in Malaysia, adding to the appeal of landed properties.
In recent years, major cities like Kuala Lumpur have seen higher property values and more transactions. However, states like Selangor and Johor have also experienced significant growth in their residential sectors. Selangor, in particular, led the market with a notable percentage of transactions and value, reflecting its strong appeal to buyers.
In smaller towns and rural areas, landed homes are often the primary type of residential property available. This trend is driven by the demand from buyers with smaller budgets, who are helping to reduce the number of unsold properties. Selangor has been a key area where this demand is evident, showcasing the region's attractiveness to potential homeowners.
For those considering investing in Malaysian property, the rural and smaller town markets offer a unique opportunity. The ability for foreign buyers to own land adds an extra layer of investment potential. This makes landed homes in these areas a compelling choice for both local and international buyers.
As the property market continues to evolve, the preference for landed homes in non-urban areas remains strong. This trend highlights the ongoing demand for space and land, which are abundant in these regions. The appeal of landed properties is likely to persist, driven by both domestic and foreign interest.
Sources: Invest Asian, Asia Real Estate Summit
14) Malaysian homebuyers had an average loan-to-value ratio of 75% in 2024
The average loan-to-value ratio for Malaysian homebuyers in 2024 was 75%.
In simple terms, the loan-to-value (LTV) ratio is a percentage that indicates how much of a property's value is borrowed through a mortgage. For instance, if you purchase a house worth $100,000 and borrow $75,000, your LTV ratio is 75%. This ratio is crucial because it affects the interest rates lenders offer. Generally, lenders provide better rates when the LTV is at or below 80%, encouraging many buyers to aim for this threshold.
When the LTV exceeds 80%, borrowers might face additional costs like private mortgage insurance, making the loan pricier. This is why many homebuyers strive to keep their LTV at or below 80% to avoid these extra expenses. The Malaysian property market was bustling in the years leading up to 2024, with a notable 22.3% increase in residential property transactions in 2022. This surge was driven by a robust economy and favorable financial policies that made borrowing more accessible.
Such high demand for properties likely influenced the LTV ratios, as more people were eager to buy homes. Many buyers possibly opted for larger down payments to secure better loan terms, contributing to the average LTV ratio of 75%. The active market environment encouraged buyers to be strategic about their financing options, ensuring they could take advantage of the best available rates.
Sources: Investopedia, Global Property Guide
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Malaysia. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) The average property price in Malaysia is now about RM 450,000, showing a slight rise from 2024
The average property price in Malaysia is now around RM 450,000, showing a slight increase from 2024.
In the first half of 2024, the property market was buzzing with activity. The average property price was RM471,918 per unit, reflecting a modest annual growth of 0.9%. This indicates a stable market with a gentle upward trend.
During this period, the total transaction value for properties in Malaysia hit RM105.65 billion, marking a significant 23.8% year-on-year increase. This robust market activity suggests that while prices rose slightly, the demand and sales were strong.
The number of properties sold increased by 8% to 198,806 units, highlighting a healthy demand. This growth was seen across all property sub-sectors, with the residential segment experiencing a 10.4% increase in transaction value and a 6.1% rise in transactions.
The commercial sector was particularly vibrant, with a 41.5% rise in transaction value and a 22.4% increase in activity. This surge was supported by government initiatives like the Housing Credit Guarantee Scheme and stamp duty exemptions for first-time homebuyers.
Sources: The Edge Malaysia, CBRE|WTW Market Outlook Report 2024, Penang Property Talk
16) Demand for co-living spaces rose by 15% in 2024, particularly among young professionals
The demand for co-living spaces increased by 15% in 2024, especially among young professionals.
Co-living spaces have become a hit because they offer a unique blend of community, connectivity, and convenience. For young professionals, these spaces are not just about affordable housing; they provide a sense of belonging and shared experiences that traditional rentals often lack.
One major draw is the flexibility of lease terms and the ability to share living costs. This setup is perfect for young professionals who crave modern amenities and want to live in a socially and environmentally sustainable way, aligning with their lifestyle choices.
The co-living market is also seen as an innovative solution to rental market challenges. It offers benefits like cost-sharing, capital appreciation, and rental yields, making it an attractive option for both tenants and investors.
Real estate agents and investors are finding co-living spaces lucrative, thanks to government and community support. This backing has helped the market gain traction, offering a fresh approach to housing.
Sources: The Growing Demand for Co-Living Spaces in Malaysia
17) Sales of properties under RM 300,000 rose by 12% in 2024 due to affordable housing initiatives
In 2024, Malaysia saw a 12% rise in sales of properties under RM 300,000, thanks to affordable housing initiatives.
The government rolled out the Housing Credit Guarantee Scheme, offering up to RM10 billion in guarantees to help people secure loans. This made it easier for many to buy homes. They also extended the stamp duty exemption for first-time buyers, which cut down the initial costs of purchasing a home.
Keeping the overnight policy rate steady at 3% ensured borrowing costs stayed low, making it more attractive for potential buyers to enter the market. These efforts were part of a broader strategy to make homeownership more accessible, especially for those in the lower- to middle-income brackets.
These measures collectively led to a significant boost in property sales, particularly for homes priced below RM 300,000. The government's focus on affordable housing played a crucial role in this trend, making it possible for more people to own homes.
By reducing financial barriers, the initiatives not only increased sales but also supported the overall property market. The combination of loan guarantees, tax exemptions, and low borrowing costs created a favorable environment for buyers.
Sources: Property Genie, The Edge Malaysia
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.