Market Analysis 2025

Malaysia’s property market in 2025 continues to show steady growth, supported by strong economic fundamentals, major infrastructure developments and rising demand from both local and foreign buyers. National data indicates that transaction value climbed to RM64.4 billion in Q3 2025, a 12.5% year-on-year increase driven by higher prices in key urban hotspots such as Johor Bahru, Kuala Lumpur and Penang. The average home price increased to RM494,384, reflecting stronger demand for well-located residential and investment properties. Although transaction volume dipped slightly by 3.5%, this highlights a trend toward more selective buying behaviour, with purchasers focusing on connectivity, affordability, rental yield and long-term capital appreciation.

Johor Bahru remains the strongest-performing market in Malaysia, driven by transformational catalysts such as the Johor Bahru–Singapore Rapid Transit System (RTS Link) and the Johor–Singapore Special Economic Zone (JS-SEZ). Properties within walking distance of the RTS have experienced significant price appreciation, with some prime areas doubling in value due to cross-border demand from Singaporean buyers and investors seeking cheaper entry prices and strong growth potential. The SEZ is also attracting multinational companies, boosting job creation and housing demand in key corridors such as JBCC, Bukit Chagar, Danga Bay, Medini and Iskandar Puteri. These factors position Johor Bahru as Malaysia’s most attractive destination for both residential and investment property in 2025.

Foreign investor interest has strengthened due to Malaysia’s revamped MM2H programme. Between late 2024 and mid-2025, more than 1,300 approvals were issued, injecting nearly RM840 million into the economy through fixed deposits and property purchases. MM2H participants show strong interest in Johor Bahru, Penang Island and Kuala Lumpur, further supporting mid- to high-end residential projects. This renewed confidence confirms Malaysia’s status as one of Asia’s most affordable and attractive long-term property investment destinations.

Developer activity in 2025 remains cautious but strategic. Many developers are prioritising transit-oriented developments, integrated mixed-use projects and affordable compact homes that meet changing buyer preferences. Industrial and logistics real estate continue to outperform, driven by e-commerce expansion, manufacturing growth and regional supply-chain relocation into Malaysia—especially in Johor and Penang. This segment is expected to remain one of the strongest contributors to property investment and rental demand.

The rental market has stabilised after two consecutive years of growth. High-rise apartments near city centres are seeing slight rental adjustments, while suburban and transit-linked areas remain resilient. For investors, this moderation presents a window of opportunity to acquire units before rental rates rise again once the RTS Link opens in 2026.

Overall, the Malaysia property market in 2025 offers strong opportunities for both homeowners and investors. Demand is concentrated in locations with solid infrastructure, public transport connectivity and economic growth drivers. Johor Bahru, in particular, continues to outperform the national average due to RTS-driven capital appreciation, SEZ momentum and strong cross-border interest from Singapore. With improving affordability, supportive government policies and robust international demand, 2025 is shaping up to be a positive year for selective property investment in Malaysia.