BIMB Research said affordable housing remained the sector’s most defensive profit pool.
PETALING JAYA: The local property and real estate investment trust (REIT) sectors head into 2026 on stabilising fundamentals with ample earnings visibility and supportive policy, analysts say.
BIMB Research said that data from the National Property Information Centre show firm pricing and steady transaction values, while lower rates and budget measures have rebuilt demand in the affordable and mid-range segments.
The research house noted that the Malaysian House Price Index inched up 0.1% year-on-year (y-o-y) to 229.1 points in the third quarter (3Q25) with the average house priced at RM494,384, indicating a broadly flat price environment.
Meanwhile, residential construction trends were mixed, with growth in completed units offset by weaker new starts and planned launches. New launches slowed to 11,533 units, with a subdued 14% take up rate, reflecting more cautious developer sentiment.
The research house said affordable housing remained the sector’s most defensive profit pool.
As of August, it said the Local Government Development Ministry had already achieved 98.8% of its target of 500,000 units of affordable housing under the 12th Malaysia Plan (12MP) and plans to accelerate delivery in 13MP, with greater emphasis on younger buyers.
This would be supported by RM10bil of guarantees under the Housing Credit Guarantee Scheme for 20,000 borrowers.
The scheme includes those without formal income, full stamp duty exemption for homes below RM500,000 and tax relief on interest of up to RM7,000 for homes under RM500,000 and up to RM5,000 for homes priced between RM500,000 and RM750,000 for agreements signed from Jan 1, 2025 to Dec 31, 2027.
These measures directly support demand for the affordable and lower mid-range products, said the research house.
It added that growth in mortages remained healthy, with residential loans rising 6.1% y-o-y to RM877.9bil as of October.
“Within this, loan growth is increasingly skewed toward homes above RM250,000, with financing for the RM250,000 to RM500,000 segment up 6.6% and the RM500,000 to RM1mil segment up 8.2%. This points to gradually rising purchasing power and a shift toward mid-range and premium housing,” said BIMB Research.
The research house said it expects Bank Negara Malaysia to keep the overnight policy rate at 2.75% throughout next year to support sustainable recovery, which should keep financing conditions conducive and encourage more potential first-time buyers and upgraders to enter the market.
According to the research house, the East Coast Rail Link, which was about 89% complete as of October, had already lifted the values of nearby property.
“The Penang Mutiara Line, now under construction with completion targeted around 2031, should also support higher density mixed use development in Silicon Island and Bayan Lepas to Penang Sentral corridor, benefiting landowners and township developers in these areas.
“In Johor, the Rapid Transit System Link, scheduled to open in 2027, together with the proposed Automated Rapid Transit network, are set to anchor new townships and intensify demand along the north-south spine.”
As for REITS, the research house said the tourism rebound has reinforced the recovery in retail assets, particularly in high traffic nodes in Kuala Lumpur and Johor Baru.
