KUALA LUMPUR: Malaysia’s property market is expected to register positive but moderate growth in 2026, supported by stable financial policies, evolving homebuyer preferences and rising ESG awareness, according to Rahim & Co Research Sdn Bhd.
Director of research and consultancy services Sulaiman Saheh said real housing demand nationwide, particularly in outskirt and suburban areas, is largely domestic and owner-occupier driven.
“We are a nation that is slowly inching towards an ageing nation. Our average age is above 30 right now. So there are a lot of growing families in the country. So we can see an emerging market within the upgraders market in the country,” he told reporters at the presentation of Rahim & Co Research’s property market review 2025-2026 today.
While the broader market continues to be anchored by owner-occupiers, Sulaiman said, investor activity remains concentrated in major urban centres such as Kuala Lumpur, Johor, Penang and parts of Kota Kinabalu.
“In Johor, investor interest has been supported by tangible infrastructure catalysts, particularly the Johor Bahru-Singapore Rapid Transit System (RTS). Along certain RTS-linked corridors, some new launches have crossed RM1,000 per sq ft,” said Sulaiman.
Against this backdrop new property launches are expected to rise modestly in line with industry expectations. “We do see it’ll be picking up a little bit. And this is looking at how the market has been actually performing in the past.”
Sulaiman said the current cycle is a phase of market normalisation, following earlier boom years when approvals and launch intensity became detached from underlying demand. “What we are seeing right now is the market growing, like entering into a new normalisation, a new phase of sustainable growth that we hope for.”
The industrial property segment will remain strong, supported by logistics, high-value manufacturing and data infrastructure expansion, Sulaiman added.
Meanwhile, commercial property trends are expected to become increasingly polarised, favouring ESG-compliant, hybrid-ready and service-focused and experiential-focused formats, while placing pressure on older, less adaptable stock.
While key states continue to attract domestic and international real estate interest, several others have stepped up in market traction, surpassing peak levels seen in the early 2010s.
Notably, Kedah and Malacca are expected to sustain transaction momentum through 2026, driven by strategic positioning and spillover benefits from neighbouring states’ industrial expansion.
In addition, east coast states are seeing rising investor interest ahead of the East Coast Rail Link and highway infrastructure projects.
In 2025, Malaysia’s property market showed signs of measured recalibration, with transaction activity moderating but overall value holding up, reflecting a shift towards quality-driven demand rather than volume-led growth.
While transaction volumes softened slightly, demand remained resilient for well-located, liveable and owner-occupier-focused developments, indicating more disciplined buyer behaviour.
Buyers became increasingly selective, prioritising affordability, connectivity and long-term value over speculative considerations.
Regionally, market activity became more evenly distributed, with states such as Johor, Kedah and Malacca recording strong momentum supported by infrastructure connectivity, industrial expansion and cross-border economic spillovers.
East coast states also saw rising interest ahead of major infrastructure projects, although activity began to normalise towards the latter part of the year.
