Malaysia’s Rental Market Hits Five-Year High  

Press Release: Malaysia’s Rental Market Hits Five-Year High  

Malaysia’s rental market hit a five-year high in Q4 2024, according  to the latest IQI Malaysia Home Rental Index report, released today by real estate giant IQI.  

The Malaysia Home Rental Index by IQI analyses nearly 100,000 residential rental transactions  since 2018. It is the only comprehensive measure of long-term rental trends in the country and  provides insights into new leases signed each quarter. 

Juwai IQI’s co-founder and group CEO, Kashif Ansari, summarised the findings.  

“National rents rose 3.9% year-over-year to an average of RM2,052 to hit a five-year high,,” he said,  “though growth remained steady rather than extreme. In the specific states, Kuala Lumpur rents  stabilised at RM2,847 after a volatile period, while Selangor rents showed a mild recovery. The  results suggest the market is trending towards stability. The fact that rents are stabilising rather than  surging ahead should be good news for renters worried about the cost of living. 

Rental Prices Hit a New High in Q4 2024 

“The Malaysia Home Rental Index in Q4 2024 reached its highest level since Q1 2020, when rents  declined due to the Covid pandemic. Today, new lease rents are 24% higher than their 2020 low, but  renters still pay RM442 less per month than in 2019, on average. 

“Compared to Q3 2024, rents grew 2.8% in Q4, and were 3.9% higher than at the end of 2023. This  steady rise, following a flat Q3, suggests that rents are returning to pre-Covid levels. 

“The trend remains healthy but not overheated when compared to the rapid growth in 2022 and  2023. Rental rates boomed by 13.1% and 5.5% in those years, respectively. 

“Our 2025 forecast calls for moderate growth, not another boom or crash. Thankfully, rental rates  have stabilised. We expect to avoid a return to the extreme volatility seen in 2020 and 2021, when  they fluctuated by as much as 26% year-over-year. 

In Kuala Lumpur, Rental Market Stabilises  

“In Kuala Lumpur, average rents held steady at RM2,847 in Q4 2024, just RM1 lower than Q3.

“However, compared to 12 months earlier, Kuala Lumpur rents fell 10.2%, making 2024 the first  year since 2021 that the state ended with lower rents than it began with. 

“What caused the drop? High rents may have priced out tenants, but a more likely reason is the  surge in home purchases over the past year, which temporarily reduced rental demand. Real estate  purchase transactions hit a record high in 2024, according to NAPIC. 

“Despite the 2024 decline, Kuala Lumpur rents remain 35% above their pandemic low. Selangor Rents Recover After a Mid-Year Decline 

“In Selangor, average rental rates increased on a quarterly basis by only 1.0% in Q4, rising from  RM1,820 to RM1,839 in Q3. They ended the year 1.2% lower than in Q4 2023. 

“Demand has weakened slightly, with the Selangor Home Rental Index peaking at 94.3 in Q3 2023.  Even so, Selangor’s rental market remains stronger than the national average, with Selangor’s  Index of 94.3 higher than the Malaysia Home Rental Index of 76.2. Both Indexes have the same  starting point, so this means Selangor rents have performed more strongly than national rents over  recent quarters. 

“For Selangor, 2024 was a big change compared to 2023. In the latter year, rents jumped decisively,  by 11.6%. 

“Selangor still outperformed Kuala Lumpur, where, as I said earlier, average rents fell 10.2%. That  indicates greater market resilience. 

“If these trends continue, the market is likely settling into a new normal rather than returning to the  rapid price increases of 2023.” 

Market Outlook: Cost-of-Living Stability Ahead 

“In summary, Malaysia’s rental market has hit a five-year high, but growth is slowing in two of its  largest cities. That should reassure renters that their cost of living will likely be relatively stable in  the year ahead.” 

-END-

Do not miss all the important happenings whether in property or other investments! It takes 5 seconds to sign up.

Sign up for daily investment news updates (FREE since Nov 2013 and FOREVER). 

Alternatively, Follow me on Telegram here. 

Please LIKE kopiandproperty.com FB page to get daily updates about the property market beyond kopiandproperty.com articles.