This article first appeared in The Edge Malaysia Weekly on December 29, 2025 - January 4, 2026

THE state of the property markets in Johor, Penang and the Klang Valley over 2025 is being closely scrutinised as record launch prices and land transactions have been reported in Johor and Penang, raising questions as to whether these states have finally caught up with Kuala Lumpur.

According to Saleha Yusoff, regional head of research and consulting at Nawawi Tie Leung Property Consultants, while the Klang Valley, Penang and Johor markets are often compared with each other, the underlying factors influencing price movements in each market are fundamentally different. She stresses that understanding these distinct drivers (see table) is essential before examining whether prices in Penang and Johor are catching up with those in the Klang Valley.

In terms of industrial land, Saleha explains that, based on publicly available data and market commentary, it is very unlikely that, on average in 2024 and 2025, industrial land prices in Penang or Johor broadly matched or surpassed those in the Klang Valley. However, she notes that in selected pockets or specific premium zones, Penang and certain Johor sub-markets are creeping into more comparable territory.

Transaction data between 2024 and 2025 show that prices in similarly sized land transactions in Penang ranged from RM60 to RM85 psf while, in the Klang Valley and Selangor, prices ranged from RM70 to RM250 psf. Land prices in certain zones in Penang were priced at around RM65 to RM85 psf while, in the Klang Valley, many premium, converted or well-located sites traded well above RM100 psf, with some pockets and converted sites listing above RM150 to RM300 psf in areas such as Shah Alam, Klang, Bukit Raja and other prime Klang Valley locations.

Saleha emphasises that the Klang Valley remains on top primarily due to bigger demand from logistics, last-mile delivery, e-commerce and manufacturing conversions as well as much greater competition for limited strategic parcels and higher land conversion or road frontage premiums. Many premium sales were for converted or re-zoned sites that attracted developer and industrial park premiums. “Penang can match lower Klang Valley levels in constrained, semiconductor-linked pockets while Johor can match lower Klang Valley pockets near ports but can rarely surpass Klang Valley’s premium highs. For investors deciding between regions, if they seek long-term capital appreciation and are comfortable paying a premium, the Klang Valley remains justified. However, if they are more cost-sensitive or target manufacturing and logistics where connectivity to port, sea or Singapore matters in Johor, or tech-supply chain relevance in Penang, then Johor or Penang may offer value, especially if investors pick the right submarket,” she says.

Samuel Tan, CEO of Johor-based Olive Tree Property Consultants, says that in the macro picture and based on data from the National Property Information Centre (Napic), the median house price in Kuala Lumpur is roughly double that of Johor Bahru. For example, he highlights that 2023 data show Kuala Lumpur’s median at around RM650,000 while Johor’s is around RM340,000. Kuala Lumpur’s market is driven by domestic economic weight, headquarter functions, high local salaries and a larger affluent population. Johor’s market, until recently, was driven more by speculative demand and mid-range local buyers with a significant oversupply in certain segments.

Where Johor now competes or exceeds is in the ultra-prime and niche segments. The convergence happens only in very specific, Singapore-facing micro markets. The price drivers in these cases are proximity to Singapore, unique views and luxury branding. Transactions that illustrate this phenomenon include the super-prime waterfront and Sentosa Cove-style living developments. This is where Johor prices directly challenge those in Kuala Lumpur’s luxury market,” he explains.

Tan cites as an example The Astaka in Bukit One Senyum, Johor Bahru, where full-floor penthouses with built-ups of about 4,000 sq ft have recorded prices in the range of RM5 million to over RM10 million. Buyers are high net-worth individuals primarily from Singapore and China, treating these units as trophy assets. By comparison, a RM5 million to RM10 million budget in Kuala Lumpur buys a bungalow in prime Bukit Tunku or a massive penthouse in KLCC. In Johor, the same budget buys a condominium, showcasing the premium attached to specific locations and views.

Other examples include branded residences such as St Regis in Forest City and Raffles in Puteri Cove. These are five-star hotel-managed residences that launched units in the RM2,000 to RM3,500 psf range, targeted at international investors from China, Singapore and Indonesia during the 2015 to 2018 boom. By comparison, this price psf range surpasses the average psf of even prime KLCC condominiums, such as Four Seasons Place and Binjai Residences, which typically range between RM1,500 and RM2,500 psf. In fact, the Johor launches matched the absolute peak of the Kuala Lumpur market.

Tan also highlights serviced apartments near the Rapid Transit System (RTS) Station as the new active frontier where prices are surging to close the gap. Resale condominiums within a kilometre of the RTS Terminal, such as five- to 10-year-old well-maintained serviced apartments, which previously saw prices stuck at RM600,000 to RM800,000, are now seeing asking prices at RM1.0 to RM1.3 million, especially for units with direct views and optimal layouts. Successful transactions are now being recorded above RM1 million, which is the foreign ownership threshold.

Singaporean buyers and investors anticipating the RTS completion at end-2026 actively entered the market between 2023 and 2025 while local upgraders are also competing. New launches are priced from RM1,200 psf, which is lower than units within Kuala Lumpur’s Golden Triangle. By comparison, a RM1.2 million condominium in central Johor Bahru now competes with a similarly priced condominium in good parts of Old Klang Road, Bangsar South or Mont Kiara. The key difference, he says, is that the Johor Bahru unit’s value is 99% derived from a single future catalyst, the RTS, while the Kuala Lumpur unit’s value is based on a mature, diversified economy.

Saleha also provides data showing that transaction prices from 2024 to 2025 for high-rise properties on Penang island averaged RM723 to RM731 psf while the mainland recorded a more modest RM444 to RM447 psf. This reflects the island’s positioning in the mid- to upper-mainstream segment compared with the mainland’s predominantly mass-market profile. Penang’s high-rise market remains distinctly bifurcated. Standard and older units, particularly in suburban and mainland locations, typically transact in the RM300 to RM600 psf range. In contrast, prime island addresses, especially seafront and high-amenity zones, command significantly higher values, with luxury units often reaching RM800 to RM1,200 psf or beyond.

In Johor, Saleha notes that transacted prices in the city centre ranged from RM850 to RM925 psf while, outside the city centre and in Iskandar Puteri, prices ranged from RM550 to RM615 psf. This trend suggests Johor’s high-rise market, at least in city-centre prime areas, is competing with mid- to upper-tiers. However, recent market indicators paint a more conservative median for Johor of between RM400 and RM600 psf for standard units. Some high-end or newly launched developments, especially serviced apartments with strong amenities and proximity to Singapore or RTS corridors, are seeing upward pressure in 2025. Typical mainstream high-rise properties still cluster significantly below Klang Valley’s top-end benchmark.

Saleha concludes that the Klang Valley remains the densest and most economically active conurbation in Malaysia. Demand from jobs, services and commerce keeps competition high, which puts broad upward pressure on prices.

Tan notes that Johor has not matched Klang Valley in a general sense. “However, it has successfully created ultra-premium, niche segments that operate on a different logic — the ‘Singapore premium’ — where prices can rival or surpass those in all but the absolute peak of the Kuala Lumpur market. For the average investor, the Klang Valley remains a more stable and diversified market. For those targeting Singapore-driven growth with higher risk, Johor’s prime nodes offer unique potential. The key is to understand that investing in Johor’s premium segments means buying into a specific, catalyst-driven narrative, not the broad Malaysian economy,” he says.

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