KUALA LUMPUR, Sept 19 – The once-bright outlook for Malaysia’s property development sector has taken a sharp turn, as optimism among developers plunges in the latest survey by the Real Estate and Housing Developers’ Association (Rehda) Malaysia.

Just six months ago, developer confidence was at its highest in five years. But according to Rehda’s Property Industry Survey, only 19% of respondents expressed optimism about the market heading into late 2025, a steep drop from 51% recorded earlier this year. Confidence in sales performance mirrored the decline, falling to 19% from 52%.

The survey, conducted between June and August 2025, covered 137 chief executives and senior management of property firms across Peninsular Malaysia.

Key Findings

New project launches slowing: Only 41% of developers plan to roll out new projects in 2H2025, compared to 56% previously.

Land acquisitions stalling: 62% have no plans to acquire new land, a reversal from the 70% who wanted to expand six months ago.

Construction woes intensify: 59% faced issues related to materials and labour.

Economic headwinds: 51% cited weak economic conditions affecting outlook.

SST concerns: 62% said the new sales and service tax (SST) would significantly raise project costs; 70% expect construction costs to increase at least 3%.

Price hikes inevitable: 73% of developers intend to raise property prices, mostly by 3%–5%.

Financing bottlenecks: 71% of developers faced financing difficulties, while 64% said buyers struggled with loan rejections or did not meet requirements.

Rehda’s Warning

Rehda president Datuk Ho Hon Sang said the reversal highlights the challenges facing the industry as it navigates rising construction costs, tighter financing conditions, and a cooling economy.

“The drop in optimism is a clear sign that developers are adopting a more cautious stance. With SST implementation, construction bottlenecks and end-financing hurdles, the industry will need to adapt quickly,” Ho noted.

What This Means for Developers

While cost pressures from labour shortages, material price hikes, and SST are unavoidable, developers can still protect their margins by improving sales efficiency.

Instead of relying only on traditional marketing or agents limited by manpower, developers can adopt centralised platforms like [MyRumahBaru] to reach a larger pool of qualified buyers.

By streamlining the buyer journey and connecting projects directly to ready-to-purchase leads, platforms like MRB help developers:

Shorten sales cycles with more efficient funnels.
Lower customer acquisition costs compared to offline marketing.
Offset rising construction and compliance costs by ensuring faster sell-through.
Improve buyer qualification with AI-driven matching of projects to budget and preferences.

In an environment where costs are rising and sentiment is cooling, efficiency in reaching buyers can make the difference between stalled launches and sustained sales momentum.

What This Means for Buyers

For homebuyers, the coming months could see higher property prices as developers pass on costs, while financing approvals remain difficult. With fewer new projects in the pipeline, buyers may also face limited options.

To stay ahead, buyers can leverage [MyRumahBaru] to track the latest projects, compare options, and identify developments that fit both their budget and loan eligibility.

Frequently Asked Questions (FAQ)

1. Why are developers suddenly less optimistic about the property market?
Because of rising construction costs, the impact of the new SST, financing difficulties, and broader economic uncertainties.

2. How much are property prices expected to increase?
About 73% of developers plan to raise prices, mostly in the range of 3%–5%.

3. Will there be fewer new property launches in the near future?
Yes. Only 41% of developers plan to launch new projects in 2H2025, compared to 56% earlier.

4. Is land acquisition slowing down too?
Yes. 62% of developers said they are not planning to purchase new land, a sharp reversal from earlier expansion plans.

5. How does the SST (sales and service tax) affect property prices?
62% of developers said SST significantly raises project costs, with 70% expecting at least a 3% increase in construction costs.

6. Are buyers also facing challenges?
Yes. 64% of developers said potential buyers are struggling to secure loans due to rejections or failing to meet requirements.

7. What are the main construction-related issues developers face?
Shortages and rising costs of building materials, as well as labour constraints.

8. Is this slowdown nationwide or limited to certain regions?
The survey covered 137 developers across Peninsular Malaysia, so the trend is widespread rather than regional.

9. What does this mean for first-time homebuyers?
They may face fewer options, higher prices, and tougher financing conditions. Using platforms like MyRumahBaru can help identify projects within their budget and eligibility.

10. How can developers offset rising costs and slower demand?
By adopting digital platforms like MRB to reach a wider audience more efficiently, qualify buyers faster, and reduce sales friction — ensuring that rising SST and material costs don’t eat away margins.