Malaysia’s real estate market outlook for 2024/2025
By Joseph Wong
The Malaysian real estate market in 2024/2025 is set to experience both opportunities and challenges across various sectors. From thriving industrial growth to shifts in residential demand, the year promises significant activity, driven by global trends, local policies and evolving consumer preferences.
The industrial real estate sector continues to dominate as one of the strongest performers in 2024, according to prominent industry experts. There is also an optimistic outlook for the preceding year, according to prominent industry experts.
This is especially so for industrial properties. Savills Malaysia group managing director and head Datuk Paul Khong pointed out that the demand for industrial properties is being fueled by the rise of data centres, logistics hubs and manufacturing facilities, with Johor, Penang and Greater KL emerging as hotspots.
“Malaysia stands to benefit from ongoing geopolitical shifts, particularly as US-China relations reshape global manufacturing,” Khong noted. He predicts that potential policy changes under a Trump administration in 2025 could accelerate the trend of companies relocating from China to Southeast Asia, driving further demand for industrial facilities.
Gather Properties founder and managing director Vincent Tan echoed these sentiments, emphasising Johor’s role as a key beneficiary of this growth. “With Singapore focusing on tourism and financial services, industrial activities are shifting to Johor, which continues to see high demand for industrial land,” he said.
Sectors on the rise
The commercial real estate market is poised for growth, with elevated rental rates and robust offline sales driving investor interest. “As industrial properties become pricier, investors are increasingly shifting toward the commercial subsector,” Knight World Realty founder Scott Tan said.
High-end residential properties in premium areas like KLCC and Mont Kiara are also attracting foreign investors, thanks to Malaysia’s political stability, favourable visa policies and a weaker ringgit. “The influx of Chinese and Taiwanese investors is bolstering demand, positioning these subsectors as key drivers of growth,” added Tan.
IQI Realty group managing director Daniel Ho pointed out that international trade is experiencing significant growth, enhancing economic prospects globally. One of the most transformative developments in the post-pandemic economy is the rise of artificial intelligence (AI) and its profound influence on industries worldwide. Far from being a passing trend, AI is revolutionising business operations. In Malaysia, the technology-driven supply chain is evolving in tandem with advancements in AI.
“Major tech giants, including Oracle, Amazon, Google, ByteDance and Microsoft, have committed over USD 20 billion to establish and expand data centres in Malaysia. The country’s strategic location, robust digital economy and supportive government policies have solidified its position as a prime destination for global tech firms looking to expand in Asia,” he said.
GPlex Realty chief executive officer Ron Ong added: "The commercial real estate sector will likely remain cautious, with a focus on flexible office spaces. Overall, 2025 should bring moderate growth with a balanced approach to investment and development."
Residential market trends
The residential property market remains diverse, catering to a wide spectrum of buyers. Oriental Real Estate chairman Eddie Lee highlighted the rising preference for renting over buying due to affordability concerns and increasing interest rates. “Renting offers flexibility and lower upfront costs, appealing to those valuing mobility,” Lee explained. However, property ownership remains attractive for those seeking stability and long-term investment benefits.
In contrast, suburban and rural areas are seeing heightened interest as the remote work trend persists. AFZ Realty founder Afizan Mohktar noted, “Demand for larger homes outside major cities continues to grow, driven by the need for more space and the changing dynamics of work-life balance.”
Development hotspots
The Klang Valley and Johor Bahru are set to witness notable developments in 2024. The Roof Realty group managing director Datuk Wira Nicholas Yap observed that demand for high-rise residential properties in the Klang Valley is rising due to urbanisation and land scarcity.
Meanwhile, Johor Bahru is rapidly transforming into a digital economy hub. “Substantial investments in data centres and digital infrastructure are attracting multinational corporations, boosting the local property market,” Yap stated. This transformation, coupled with initiatives like the JS-SEZ and Forest City Financial Zone, positions Johor as a vital economic and real estate centre.
“Johor, in particular, has emerged as a critical economic hub due to its proximity to Singapore and its strategic location along major shipping routes. The Johor-Singapore Special Economic Zone (JS-SEZ) is expected to play a pivotal role in boosting Malaysia’s economic development while fostering stronger cooperation between the two nations. This collaboration is set to enhance trade, investment and cross-border logistics, streamlining economic connectivity between Malaysia and Singapore,” Ho said.
Additionally, the reignited ambitious Forest City project—a smart city integrating residential, commercial and industrial spaces with cutting-edge technology—will further establish Malaysia as a central hub for regional and global trade.
“The substantial investments by global tech leaders and the development of transformative infrastructure projects such as the JS-SEZ and Forest City are cementing Malaysia’s leadership in technology-driven trade and innovation. The synergy between advancements in AI and trade infrastructure will allow the nation to capitalise on global trends, attracting more high-tech industries.
“Furthermore, Malaysia’s deepening ties with neighbouring economic powerhouses like Singapore will accelerate the flow of capital, talent and innovation, fostering rapid growth across these sectors. This dual focus on digital and logistical strength positions Malaysia on a promising trajectory to redefine regional and global trade dynamics,” Ho explained..
Cautious optimism
While the outlook for 2025 remains positive, experts caution against economic uncertainties, rising construction costs and evolving buyer preferences. Mohktar emphasised the need for “careful market strategies” to navigate these challenges effectively.
Most remained optimistic, albeit cautiously. To sum it all, Foreward Realty founder Darien Mah said: "Coupled with a good selection of upcoming new launches, I believe the outlook for the Malaysian real estate industry in 2025 is a positive one."
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Perspectives from top negotiators
Daniel Nazreen
IQI Realty Sdn Bhd
“More people may choose to buy property in Malaysia due to several factors. Government incentives like affordable housing schemes, stamp duty exemptions and EPF withdrawals make homeownership more accessible. Despite higher interest rates, mortgage rates remain relatively low, encouraging buyers to lock in long-term financing. Property offers long-term investment potential and security while rising rental prices push people toward owning rather than renting.”
Chew Wei Loong
IQI Realty Sdn Bhd
“I expect the property market to maintain its positive momentum, supported by economic recovery and growing investor confidence. Key areas like Kuala Lumpur, Johor Bahru and Penang are attracting attention, especially as developers increasingly focus on suites designed for short stays. Johor Bahru, in particular, shows promising potential due to its proximity to the CIQ and RTS, which enhances connectivity. Overall, I foresee continued growth in the property market, with high interest in prime urban locations.”
Charis Chan
IQI Realty Sdn Bhd
“In my opinion, Malaysia’s property market in 2024 looks pretty promising in the bigger cities. Cities like Kuala Lumpur and Penang are set to see a decent boost thanks to new infrastructure like expressways and light rail extensions. But I foresee challenges for smaller towns and states due to oversupply in commercial spaces and serviced apartments which are moving slower.”
AJ Anand
IQI Realty Sdn Bhd
“The Malaysian real estate market outlook for 2024 is optimistic, building on the recovery from 2023. Key drivers include government incentives for first-time buyers, a resurgence in commercial properties and ongoing urbanisation. Stable interest rates may enhance mortgage affordability, attracting more buyers while increased foreign investment is anticipated. Technological advancements and demand for sustainable developments will reshape the market. Additionally, the popularity of co-living and shared spaces is expected to rise, catering to millennials and young professionals.”
John Lee
Knight World Realty (M) Sdn Bhd
"Stable interest rates, improved economic conditions and the government’s drive to attract foreign investments to achieve a 5.5% GDP growth target are expected to boost buyer confidence. These initiatives are likely to contribute to rising average incomes, thereby broadening the buyer base. While inflationary pressures persist, demand for residential and commercial properties is projected to remain robust, solidifying real estate as an attractive investment choice for both local and international investors."
Ng Gah Kian
Knight World Realty (M) Sdn Bhd
"The real estate market in 2024 shows signs of warming up. With stable interest rates, buyers are more confident and are re-evaluating the idea of owning their dream homes. High-quality, eco-friendly properties are especially in demand, as many seek communities that offer both privacy and top-notch security. Urban prosperity continues to attract interest, while the tranquility of suburban living appeals to those exploring second-home options. On platforms like Xiaohongshu, authentic stories and gentle sharing resonate deeply, engaging a growing number of potential buyers."
Rahim Zulkifli
Knight World Realty (M) Sdn Bhd
“In my opinion, more people choose to buy a house because there are many affordable houses built by the government. The government has also provided various housing schemes for first home buyers such as SJKP and so on. In fact, most employees have received an increase in their basic salary.”
Chen Ching Huei
Tech Realtors Properties Sdn Bhd
"The property industry in Malaysia is poised for growth in 2024, fueled by economic recovery, government initiatives supporting affordable housing and stable interest rates. A focus on sustainable development and increasing foreign investments is expected to further energise the market. Additionally, infrastructure projects, such as public transportation expansions, are likely to drive property demand, particularly in urban areas. However, challenges like inflation, rising construction costs and global economic uncertainties may influence market dynamics. Overall, positive economic trends and supportive policies present a solid foundation for growth, though external factors could impact its pace and sustainability."
Arnold Khong
Tech Real Estate Sdn Bhd
"Back to basics, the property market ultimately depends on the broader economic outlook. The fluctuations in the property industry are closely tied to Malaysia's economic performance. The government has been effectively steering a steady recovery by attracting major foreign companies. However, with Donald Trump winning the US Presidential Election, I hope that the relationship between the US, China and Malaysia remains stable, avoiding any uncertainties that could impact our export market. If this balance is maintained, Malaysia’s property market is likely to perform well in the coming years."
Jason Teo
Gplex Realty Sdn Bhd
"In 2024, I am optimistic about the recovery of Malaysia’s property market, especially in urban areas. With economic revitalisation and supportive government policies—such as preferential loans for first-time buyers—demand for property is expected to steadily increase. Additionally, major infrastructure projects like the RTS and LRT 3 are driving growth in both new developments and property values. This makes 2024 a promising year and I believe 2025 will be an even more promising year for the real estate market."
Karen Tan
Foreward Realty Sdn Bhd
"Malaysia's property market displayed encouraging signs of recovery in 2023, with momentum expected to carry into 2024. The pause in the OPR rate and supportive government initiatives have bolstered market stability and driven demand. Healthy economic fundamentals and easing inflation further enhance the sector's outlook, particularly in high-end residential areas. The luxury property segment continues to thrive, fueled by foreign buyers, notably Chinese investors, attracted by Malaysia's political stability and favorable visa policies. Meanwhile, the affordable housing sector remains robust, catering to domestic demand. Despite global economic uncertainties, Malaysia’s real estate sector is poised for sustainable growth across all segments, presenting promising opportunities for both local and international investors in 2024."
Larry Kum
Foreward Realty Sdn Bhd
"I anticipate the property market will grow in 2024, though a full boom might take time. Minister Nga Kor Ming's statement highlights promising factors, including government support, an improving economy and favorable policies. Rising demand from young buyers, ongoing urbanization and foreign investments are also driving recovery. Urban areas like Bangsar are particularly benefiting from infrastructure developments and premium housing projects, which are increasing interest. However, maintaining cautious optimism is essential, as economic factors such as interest rates and inflation could still impact market dynamics."
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