KUALA LUMPUR: Buying interest in Malaysia's property market remains resilient, with momentum expected to be sustained in 2026 (FY 2026), supported by a positive sector outlook, stable sales and ongoing development projects, said MBSB Research.
The firm said the overall performance of property companies was decent in 2025 with good earnings and stable new property sales.
Meanwhile, the KL Property Index is playing catch-up with gains of 6.0 per cent so far this year, it said in a note.
MBSB Research noted that Bank Negara Malaysia data showed that total property loan applications in November 2025 were stable at RM55.3 billion, up slightly 0.14 per cent from a year ago after three months of consecutive growth.
Compared with October, applications fell 8.3 per cent in November, after a 9.6 per cent rise the previous month.
For the first eleven months of 2025, total applications reached RM605.7 billion, up 3.08 per cent from a year ago, pointing to a positive year-end.
Approved loans also remained robust, rising 8.5 per cent yoy to RM23.6 billion in November, supported by a higher approval ratio of 42.7 per cent, up from 39.4 per cent in November 2024.
Despite a monthly decline of 13.5 per cent, cumulative approved loans between January and November 2025 increased 1.5 per cent year-on-year (YoY) to RM263.5 billion, reflecting steady property sales and developer activity.
"We see stable new sales prospects going into 2026, as the Johor Bahru–Singapore Rapid Transit System (RTS) and Johor-Singapore Special Economic Zone (JS-SEZ) will remain the catalysts for the sector.
"Besides, property companies saw a new growth catalyst from industrial properties, which should support the outlook for property companies in the coming years. Hence, we see more upside for the KL Property Index to reflect the solid fundamentals of the sector," it said.
MBSB Research maintained a "Positive" outlook on the sector, highlighting corporate initiatives such as real estate investment trust listings by IOI Corp Bhd and SP Setia Bhd as potential sentiment boosters for property stocks.
Its top sector picks include Mah Sing Group Bhd (Buy, TP: RM1.54), Matrix Concepts Holdings Bhd (Buy, TP: RM1.65) and UOA Development Bhd (Buy, TP: RM2.01).
The firm said Mah Sing's prospects are underpinned by expanding industrial property exposure through a joint venture with KLK Land and consistent sales of affordable homes.
Matrix Concepts is expected to benefit from stable sales at Bandar Sri Sendayan, its acquisition of Horizon L&L, and the upcoming MVV City project, which stands to capitalise on economic growth in Negeri Sembilan.
UOA Development's maiden Johor project launch is projected to boost sales in FY 2026, complemented by a healthy net cash position and an attractive dividend yield of 5.3 per cent.