KUALA LUMPUR (Jan 29): Rising living costs, elevated property prices, and household financial commitments continue to weigh on Malaysian homebuyers, particularly in major urban centres, according to insights shared at the 18th Malaysian Property Summit (18MPS).
Socio-Economic Research Centre (SERC) executive director Lee Heng Guie said affordability challenges are expected to remain a structural issue, especially in cities such as Kuala Lumpur and the Klang Valley, amid an ageing population and higher household debt levels.
Lee noted that the household affordability index, which compares median income against prevailing home prices, shows worrying trends in several locations.
“In many urban areas, house prices are now more than four to five times the median household income, which places them firmly in the unaffordable category. A ratio below three is generally considered healthy,” he said.
While median household income has risen to approximately RM7,017, Lee explained that disposable income remains constrained after accounting for daily expenses and financial obligations. He stressed that prudent homebuyers should keep total financial commitments within 30% of monthly income when considering property ownership.
The prolonged affordability strain is also expected to influence demand for commercial property in KL, as household spending patterns directly affect retail, services, and office occupancy in urban centres.
Speaking during a panel session on Malaysia’s property market outlook beyond 2026, former Malaysian Investment Development Authority (Mida) board member and Taylor’s University adjunct professor Ong Kian Ming cautioned that the pace of development in Johor, particularly in Johor Bahru, requires closer regulatory oversight.
He said heightened investor interest linked to the upcoming Rapid Transit System (RTS) Link between Malaysia and Singapore has contributed to an increasingly crowded development pipeline in the city centre.
When the RTS becomes operational by late 2026 or early 2027, Ong warned that traffic dispersion and urban mobility could become significant challenges if not addressed proactively.
He proposed pedestrianisation strategies, suggesting walkable zones of up to 500 metres, to improve accessibility, enhance commercial vibrancy, and support surrounding developments. Such urban planning concepts have also proven effective in established business districts offering office space in Bukit Jalil and mature commercial nodes in Kuala Lumpur.
Among all real estate asset classes, Ong highlighted that the industrial and logistics sector is the most closely aligned with Malaysia’s next phase of foreign direct investment (FDI) growth.
With trade flows reshaping due to geopolitical shifts, including US–China tensions, demand for industrial land in Selangor, logistics hubs, and advanced manufacturing facilities remains resilient.
He noted that innovation within industrial estates — such as smart park management, autonomous vehicles, and drone-based logistics — could help Malaysia develop flagship industrial ecosystems capable of competing at a regional or even global level. This trend continues to benefit areas with established infrastructure, including industrial property in the Subang area and factory developments in Puchong.
In a move set to enhance market transparency, National Property Information Centre (Napic) valuation and property services department director Norhisham Shafie announced that Napic’s e-data will become fully accessible to the public from Feb 1, 2026.
Previously limited to registered members under Bovaep, the expanded access will allow researchers, academics, proptech firms, and individual buyers to purchase transaction and rental market data directly.
This increased transparency is expected to support more informed decision-making across residential, commercial property in KL, and investment segments.
On the sidelines of the summit, Norhisham noted that it has become increasingly difficult to find serviced apartments in Kuala Lumpur that offer both prime locations and attractive pricing.
He said many unsold units were completed more than three years ago and are priced between RM500,000 and RM1 million, placing them beyond the affordability range of most buyers. In contrast, serviced apartments completed within the last three years have shown stronger take-up.
Held under the theme “Reshaping Real Estate: Alternative Assets, Adaptive Reuse & the Future of Investment”, the 18MPS summit brought together 300 property professionals nationwide. Discussions spanned investment trends, adaptive reuse strategies, alternative assets, and policy considerations shaping Malaysia’s real estate landscape heading into 2026.
The conversations underscored a clear shift toward industrial land in Selangor, strategically located office space in Bukit Jalil, and well-connected commercial property in KL, as developers and investors adapt to changing affordability dynamics and economic priorities.
Malaysia