Malaysia’s property market is surging – Here’s what’s behind the growth

A winning combination of investment appeal, smart urban planning, and government initiatives

Malaysia’s real estate market is experiencing unprecedented growth, with property transactions exceeding MYR217.46 billion in early 2024, surpassing initial targets, according to New Straits Times. Meanwhile, foreign direct investment (FDI) in the sector has surged, with USD1.98 billion invested in the first five months of the year—a 70 percent increase compared to 2023. 

This surge is fuelled by a strong focus on affordable housing, infrastructure expansion, and sustainable urban development, positioning Malaysia as a key property investment hub in ASEAN. 

“Malaysia’s property market is experiencing a defining moment, surpassing transaction targets and positioning itself as a leader in affordable housing across ASEAN,” says Assoc. Prof. LAr. Dr. Nor Atiah Ismail, President of the Institute of Landscape Architects Malaysia (ILAM) and judge for the PropertyGuru Asia Awards Malaysia in partnership with iproperty.com.my. 

“While the numbers are impressive, this growth is not just about properties changing hands; it is about transforming our cities, communities, and how people experience urban life.” 

Affordable housing: A game-changer in Malaysia’s real estate growth 

Business Today Malaysia stated that Malaysia has taken the lead in affordable housing development in the region, with government-backed initiatives such as PR1MA, Residensi Wilayah, and Rumah Selangorku enabling more Malaysians to own homes. Unlike previous low-cost housing projects, these new developments emphasise liveability, green spaces, and quality community planning. 

“One of the primary drivers behind this growth is the Malaysian government’s strong commitment to affordable housing,” Dr. Nor Atiah states. “However, what sets Malaysia apart from other ASEAN countries is its increasing focus on ensuring that affordability does not compromise liveability.” 

“Gone are the days when low-cost housing meant poorly designed, dense, and uninspiring spaces. Today, more projects incorporate green spaces, public parks, and community-friendly infrastructure, making affordability synonymous with quality living.” 

Infrastructure development fuels demand in key urban areas 

Another key factor behind Malaysia’s thriving real estate market is its rapid expansion of public transport networks and expressways, making suburban areas more accessible and attractive to homebuyers and investors. The MRT, LRT, and major highways have helped drive demand for transit-oriented developments (TODs), reported the Bangkok Post. 

“The expansion of the MRT, LRT, and major expressways has significantly increased accessibility, making suburban areas more attractive for homeowners and investors,” Dr. Nor Atiah explains. “Transit-oriented developments (TODs) are thriving, proving that well-connected, walkable, green urban centres are the future.” 

“When cities are designed around public transit, they must also consider pedestrian-friendly environments, shaded walkways, green buffers, and public plazas that enhance mobility without depending entirely on cars,” Dr. Nor Atiah adds. 

Sustainability and nature-based solutions take centre stage 

As climate change and urban resilience become pressing global issues, Malaysia is leading the way in sustainable real estate development. More projects now integrate biophilic design, green roofs, and flood-resilient landscaping to enhance property value while reducing environmental impact. 

“Another exciting shift in the property market is the rising demand for nature-inspired developments,” Dr. Nor Atiah points out. 

“Today’s buyers and investors are more conscious of their living environment, preferring sustainable developments, biophilic design, and climate-responsive planning.” 

This shift reflects a growing awareness of urban heat islands, rising temperatures, unpredictable weather patterns, and worsening floods that are pushing developers to embed climate-conscious planning into their projects. 

“We are facing the impacts of climate change—and our built environment must be part of the solution.” 

“Recognising the urgent need to embrace resilience and sustainable urban planning, the Institute of Landscape Architects Malaysia (ILAM) has been actively championing Nature-Based Solutions (NBS) as a fundamental approach to all developments,” Dr. Nor Atiah highlights. 

The Sun explained that ILAM has been actively promoting NBS to integrate ecological systems into real estate projects. These strategies include urban forests, flood-resilient landscapes, and biodiversity corridors that regulate temperatures and improve stormwater management. 

Malaysia’s global recognition: Award-winning developments shine 

Malaysia’s approach to sustainable, well-designed developments has not gone unnoticed. The country’s top real estate projects recently gained global recognition at the 19th PropertyGuru Asia Property Awards Grand Final 2024, where Malaysian developers competed and were deemed Asia Winner against 15 markets across Asia, Australia, and the Middle East, taking home several prestigious awards:

• Best Mid End Condo Development (Asia) – Helix2 @ PJ South by Eupe Corporation Berhad
• Best Completed Condo Development (Asia) – The Park 2 Pavilion Bukit Jalil by Malton Berhad 
• Best Eco Friendly Condo Development (Asia) – Alfa Bangsar by City Motors Group 
• Best Affordable Housing / Landed Development (Asia) – Avisa Residences, Tropicana Alam by Tropicana Corporation Berhad 
• Best Investment Housing Development (Asia) – Iconia Garden Residence by Gunung Impian Development Sdn Bhd 
• Best Branded Residential Development (Asia) – Quayside JBCC by Bangsar Heights Pavilion – Malaysia (WINNER) 
• Best Smart Home Development (Asia) – Sanubari @ Bandar Dato Onn by JLand Group Sdn Bhd  
• Best Mega Township Masterplan Design (Asia) – Medini Innopolis by Iskandar Investment Berhad 
• Best Housing / Landed Architectural Design (Asia) – Ponderosa Callista by Berinda Group 

“Developers who adopt these principles are not just building for today’s market, but for a future where climate adaptation and urban resilience will define real estate success,” Dr. Nor Atiah states. 

What’s next for Malaysia’s property market? 

While Malaysia’s property sector is enjoying an unprecedented boom, long-term sustainability will depend on balancing affordability, urban resilience, and environmental responsibility. Ensuring housing affordability for locals while continuing to attract foreign investment is key to maintaining stable growth. 

“Malaysia’s strategic regional property investment hub position also fuels this momentum,” Dr. Nor Atiah explains. 

“Our property market remains one of the most affordable in ASEAN, attracting foreign investors from Singapore, China, and the Middle East who see Malaysia as a high-value destination.” 

However, Dr. Nor Atiah also emphasises that affordability should not come at the expense of quality and sustainability. 

“The success of a property market should not be measured merely by sales and foreign investments, but by how well our developments contribute to the overall well-being of both people and the environment,” she concludes. 

With a strong focus on transit-oriented living, nature-based urban design, and sustainable investment strategies, Malaysia is well-positioned to lead ASEAN in real estate transactions and become a global model for sustainable urban development. 

Know of any award-worthy residential, commercial, or industrial projects in the country? Nominate them for the 12th annual PropertyGuru Asia Awards Malaysia in partnership with iProperty.com.my on or before 30 May 2025. To know more, visit AsiaPropertyAwards.com/Award/Malaysia/. 

Gynen Kyra Toriano, Digital Content Manager at PropertyGuru, wrote this article. For more information, email: [email protected].