PETALING JAYA: The Johor-Singapore Special Economic Zone (SEZ) is the “only bright spot” for Malaysia’s property sector, Rakuten Trade head of equity sales Vincent Lau says, citing resilient demand and investor interest in the area.
“Johor is an attractive spot because many people may choose to live there while commuting to Singapore, making it an attractive place to invest,” he told StarBiz.
Lau said property transaction volumes are expected to recover in the second half of 2026 (2H26) after a softer first quarter (1Q26), which he attributed largely to seasonal factors and heightened uncertainty that prompted buyers to delay purchases.
“The take-up rate has been pretty decent, and I think transaction volumes are expected to pick up again in the second half of 2026 (2H26).
“Structurally, I do not think there are major issues with the sector. Property is still very much a commodity business, and the industry remains fairly stable,” he said.
Lau said developers such as IOI Properties Group Bhd
are still seeing decent sales, and overall sales remain fairly strong.
“For 2H26, loan approvals are something to watch, but banks are still willing to lend.
“Interest rates remain fairly low, and there has not been any significant deterioration. Banks have increased provisions, but I do not think that is a concern.
“Now that we are seeing some de-escalation from the US-Iran conflict, supply chains should reopen. Oil prices are also looking better. Unless there is a lockdown or a new war, things should normalise. I would not say demand will suddenly surge, but we should recover from slower growth in 1Q26 as uncertainty eases.”
BIMB Research said the property sector is expected to be supported by sustained demand for well-priced landed and township homes, continued government policy support, rising industrial land demand, and healthy earnings visibility from sizeable unbilled sales in 2H26, following softer property transaction volumes in 1Q26.
The research house said data from the National Property Information Centre showed overall property transaction volume fell 8% year-on-year (y-o-y) to 89,966 units in 1Q26, while transaction value was relatively resilient, easing only 0.6% y-o-y to RM51.09bil.
Residential remained the largest segment, with 52,936 transactions worth RM22.6bil.
BIMB Research’s data point to a more selective residential market rather than a broad downturn. “Activity softened, new launch take-up was weak and completely unsold stock increased, but house prices stayed positive and transaction value held up relatively well.
“Chinese New Year and Hari Raya holidays likely delayed viewings, loan approvals and sales and purchase agreement (SPA) signings, particularly among lower and middle income buyers, while eSPA may have created temporary processing friction during the transition,” BIMB Research said in a report.
The research house noted demand for homes below RM300,000 is still healthy, but weaker transactions show that buyers are facing difficulty getting financing.
“We continue to prefer developers with landed or township projects, affordable pricing, low unsold stock and strong conversion from bookings to SPA.”
Going into 2H26, BIMB Research said policy support should remain a key anchor for the Malaysia property sector, particularly for affordable and mid-market housing.
The research house noted the government’s focus on homeownership remains clear, supported by the 13th Malaysia Plan target of one million affordable homes between 2026 and 2035, RM10bil in guarantees under the Housing Credit Guarantee Scheme for 20,000 borrowers, full stamp duty exemption for first-time buyers of homes below RM500,000 and income tax relief on housing loan interest for homes priced up to RM750,000.
“These measures should help sustain demand in the affordable-to-mid-range segment, which remains the core product category for most listed developers under our coverage.”
“On the cost side, the expansion of Simen Rahmah in 2026 provides an additional buffer for housing projects priced below RM300,000, with subsidised cement supply helping to reduce construction cost pressure and protect affordability.”
