This article first appeared in Wealth, The Edge Malaysia Weekly on April 28, 2025 - May 4, 2025

For years, Johor’s property market moved to a cautious beat. Oversupply issues loomed large, the pandemic reshaped how we lived and worked, and investors treaded lightly. But today, there is a new pulse on the ground. Johor is stirring, energised by the Johor-Singapore Special Economic Zone (JS-SEZ).

The JS-SEZ is not just a buzzword. It is a structural pivot point for both Singapore and Malaysia. It promises smoother cross-border connectivity, streamlined regulations and stronger bilateral economic collaboration. And as history has shown, where economic engines hum, the property sector follows.

Numbers from industry sources such as the National Property Information Centre (Napic) tell a compelling story. In the first nine months of 2024 (9M2024), Iskandar Malaysia recorded 30,893 property transactions worth RM25.9 billion — a jump of 16% in volume and 36% in value on a year-on-year (y-o-y) basis. This is not a speculative spike. It is sustained momentum backed by infrastructure, cross-border mobility and demand fundamentals. Let’s unpack the resurgence.

The residential segment continues to strengthen, particularly in landed housing, where demand is still robust. Townships like Horizon Hills, Eco Botanic and Bandar Dato’ Onn are experiencing strong buyer interest.

According to Napic, Johor’s residential property transactions rose 15% y-o-y while total value surged 35% in 9M2024. Average transaction prices have increased in key hotspots, reflecting steady demand.

Landed homes saw the most activity, particularly double-storey terraced and semi-detached units, fuelled by Singapore-linked demand and local upgraders. The high-rise segment remains subdued due to lingering oversupply, though absorption rates are improving in selected areas with strong connectivity to the city state.

The JS-SEZ has reinforced buyers’ confidence, particularly for developments near the Johor Bahru-Singapore Rapid Transit System (RTS) Link and Iskandar Puteri. With demand on the rise and new launches being more measured, Johor’s residential property market is in a much healthier place than it was five years ago.

The office sector in Johor has historically been overshadowed by Kuala Lumpur and Singapore. However, demand is starting to tick up in Iskandar Puteri and Medini, where newer Grade A office spaces offer lower costs compared with Singapore.

Johor Bahru purpose-built office rental index recorded modest performance in 2024, maintaining a growth rate of 0.1%, according to Napic’s data. The rental market is still strongly favourable to tenants. Looking ahead, with JS-SEZ in the picture, demand for office space, especially in Johor Bahru, is expected to strengthen due to flexible workspace adoption, particularly from start-ups and small and medium enterprises looking for cost-effective regional offices, and increased demand from Singapore-based companies, particularly in tech and professional services, exploring expansion into Johor.

While older office buildings in the Johor Bahru central business district still struggle with high vacancies, demand for modern office spaces in Medini and Nusajaya is growing. As the announced JS-SEZ regulatory incentives take hold, Johor’s office market could see more sustained interest from investors.

Johor’s retail sector has rebounded strongly, benefiting from a surge in cross-border shopping and domestic recovery. Tourism-driven retail spending is rising, especially from Singaporean shoppers taking advantage of the foreign exchange rate.

With an average daily border crossing of about 300,000 and weekend crossings of more than 400,000, the ever-increasing trend is set to take another leap with the RTS Link. With a capacity of 10,000 passengers per hour, the RTS Link is set to boost daily commuter traffic and retail spending is poised to increase further. This is more than just a recovery — it is a repositioning of Johor as a binational retail hub.

Similarly, data from CBRE indicates that Johor’s industrial sector is still its strongest performer, with industrial land values and rents climbing steadily in key logistics hubs.

Industrial transaction count increased 5% y-o-y in 9M2024, with transaction value of RM4.5 billion, up 51% y-o-y. Iskandar Malaysia continues to be a key industrial hub, largely due to spillover requirements from Singapore.

The warehouse market in Johor is experiencing significant growth. Nusajaya, Senai and Pasir Gudang are seeing heightened investor interest, particularly from companies seeking cost-effective manufacturing and distribution hubs in close proximity to Singapore. The JS-SEZ will further accelerate this trend by improving cross-border logistics efficiency.

Johor’s industrial property market is not just growing, it is becoming a regional powerhouse for trade and logistics.

The issue of property overhang, especially high-rise residential units, has cast a long shadow over Johor. However, the market is gradually rebalancing.

In 2024, the state accounted for 15% of Malaysia’s total unsold residential stock, but new supply is better controlled compared with previous years.

Developers are now prioritising right-sized, well-located units over speculative high-density projects and integrated developments with strong accessibility, especially those linked to the RTS and JS-SEZ corridors.

The overhang challenge remains, but it is being managed, not worsening. With demand rising and supply moderating, Johor’s property market is on a much firmer footing.

The numbers are up. The interest is real. And the timing couldn’t be better.

With transaction value rising 36% y-o-y in Iskandar Malaysia and the SEZ laying the foundation for binational economic cooperation, Johor’s property market is no longer just a bet on future potential. It is already delivering results.

What makes this growth phase different is not just a policy tailwind, but a convergence of infrastructure investments and government support from both nations. From residential to retail and office to industrial, Johor is no longer simply recovering — it is reshaping itself as one of Malaysia’s most investable property markets.

Michael Lai is executive director of wealth advisory (wealth management) at OCBC Bank (M) Bhd

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