After Budget 2027, RHB Research kept an “overweight” call on property, saying the negatives are largely priced in. But the same week’s data shows a two-speed market: high-end residential, industrial and commercial investment property are holding up, while mass-market demand is softer. Housing loan approvals fell 13.1% year on year in August, the residential overhang reached 33,094 units in Q2, and Kenanga expects the OPR to rise to 3% in the first quarter of 2027. For home buyers, that means opportunity in negotiation, but only if your financing is solid and you choose the segment carefully.
Investors see value. Buyers need a plan.
What analysts said this week
On 13 October, RHB Research maintained its overweight rating on the property sector. It estimated listed developers trade at a 60% discount to revalued net asset value, wider than 51% in May, after a selloff it linked to rising bond yields, political uncertainty and geopolitical volatility. RHB expects Budget 2027’s extended first-home stamp duty relief to help developers with affordable and mid-range products, and named Matrix Concepts, Mah Sing and LBS Bina in that group.
RHB also pointed to Johor: the JS-SEZ master plan is expected in December, which it sees as a catalyst for developers with Iskandar Malaysia exposure. It reported that aggregate property sales rose 32% year on year in Q2 2026 (reported — verify), with industrial, high-end residential and commercial investment property resilient and mass-market demand softer.
Developers are still planning launches. OSK, for example, has a 2027 pipeline with an estimated GDV of RM1.34 billion, and new KL projects continue to be previewed.
A two-speed market: which segments are holding up
| Signal | What it says | What I take from it |
|---|---|---|
| Analyst sector call | RHB overweight; negatives “largely priced in” | Developers’ share prices, not house prices. Do not read it as a price forecast. |
| Segment trend | High-end, industrial and commercial investment resilient; mass market softer | More room to negotiate on mass-market and mid-range stock. |
| Loan approvals | August approvals down 13.1% to RM23.8b; applications down 4% (MBSB Research) | Banks are more selective. Get pre-assessed before you book. |
| Overhang | 33,094 units in Q2, up from 32,801 in Q1 | Unsold completed stock gives buyers bargaining power. |
| Interest rates | Kenanga expects an OPR hold in November and a rise to 3% in Q1 2027 (forecast only) | Stress-test your instalment at a higher rate. |
Financing is the swing factor
Demand is not the only issue. Many buyers who want to buy simply cannot get the loan they need. MBSB Research noted that applications for January to August were still up 1.3% to RM440.8 billion, so interest is there, but August approvals fell sharply. I covered this in detail in our guide on how to get your home loan approved in 2026.
A rate rise in early 2027 is a forecast, not a decision, and Bank Negara’s Monetary Policy Committee will make its own call. But planning for a higher instalment now is a sensible buffer, especially on a 35-year loan.
What developers want next, and why I would not wait for it
Rehda welcomed the Budget’s housing measures but asked for more: raising the first-home stamp duty ceiling to RM1 million, reviving the Home Ownership Campaign (HOC) to clear completed unsold homes, and a review of federal and state development charges, as building costs keep rising.
None of these were announced. Waiting for a possible HOC can backfire if the unit you want sells, or rates rise in the meantime. If you are buying a first home today, the confirmed relief is already meaningful: full stamp duty exemption up to RM500,000 and partial relief up to RM750,000 for agreements from 2027 to 2030. Details in our Budget 2027 guide.
What I would do, by buyer type
- KL city and city-fringe buyers: prime locations are holding value, so focus on build quality, tenure and real walking distance to rail rather than hunting for a fire sale. Compare completed vs new launch condos in KL.
- M40 suburban buyers (Klang Valley): this is where softer demand gives you leverage. Compare nett prices, rebates and packages using our negotiation guide.
- First-time and affordable buyers: lock in your loan eligibility first, then use the stamp duty relief and any SJKP guarantee you qualify for. Start with the first home buyer guide.
- Serviced apartment investors: be selective; overhang is concentrated here. Run the six-point serviced apartment check.
- Johor Bahru buyers: the JS-SEZ master plan and the RTS Link support demand, but Johor also has a high overhang. Read what the RTS Link timeline means for JB buyers.
💡 My practical view: a soft mass market plus tighter lending usually rewards buyers who are already loan-ready. Get pre-assessed, shortlist two or three projects, and negotiate on the nett price. Do not buy because a stock analyst is bullish; buy because the home fits your budget and life for the long term.
Frequently asked questions
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Not sure if now is the right time for you?
WhatsApp DMS Team. Our consultants in KL and JB will check your loan eligibility and compare nett prices across projects in your budget, free of charge.
About the author: Jason Chan (DMS Jason Chan)
Jason is a registered real estate negotiator (REN 78007) and founder of DMS Team, a property consultancy registered under EUM Realty Sdn Bhd [E(1)1708] with consultants across Kuala Lumpur and Johor Bahru. He researches and reviews every market analysis published on dms-team.com.
This article is general information as at 14 October 2026, written from an agent’s practical perspective. It is not financial, investment or legal advice, and analyst views on listed developers are not recommendations to buy any stock. Budget measures are proposals until legislated; confirm with official announcements.
Sources: The Star: Developers set for recovery amid budget boost and Johor catalyst; EdgeProp Daily Digest, 7 October 2026 (loan approvals and overhang); BusinessToday: BNM seen raising OPR to 3% in 1Q27; Malay Mail: Rehda backs Budget 2027 housing measures; EdgeProp Daily Digest, 9 October 2026 (Budget 2027, OSK pipeline); EdgeProp Daily Digest, 12 October 2026.
Last updated 14 October 2026 · DMS Jason Chan, REN 78007