Knight Frank: Budget 2027 sets constructive foundation for property market

PETALING JAYA (BUDGET ANNOUNCEMENT), KUALA LUMPUR, JOHOR–SINGAPORE SPECIAL ECONOMIC ZONE, BUKIT KAYU HITAM–SADAO, JOHOR, PENANG, NEGERI SEMBILAN, KEDAH, SARAWAK, SABAH, SELANGOR, JOHOR BAHRU, 11 OCTOBER 2026 —

Budget 2027 provides a constructive platform for Malaysia’s property market, though timely and coordinated implementation will be needed to attract private investment and deliver lasting benefits, according to Knight Frank Malaysia.

The assessment was released by the property consultancy in a statement on Friday, Oct 9, following the budget announcement in Petaling Jaya.

The consultancy welcomed the budget's emphasis on connectivity, investment facilitation, homeownership, and urban liveability. It said that infrastructure spending must translate into better connectivity, stronger investor confidence, and sustainable economic activity. The firm also stated that delivery would be the key test of the budget's effectiveness and that it would monitor the rollout of measures and their impact on the property market over the coming year.

Knight Frank highlighted that continued focus on strategic growth corridors, including the Johor–Singapore Special Economic Zone and Bukit Kayu Hitam–Sadao, alongside progress on the East Coast Rail Link, could broaden investment beyond established economic centres. The consultancy also welcomed support for first-time homebuyers, affordable housing, and the revival of abandoned housing projects, as well as investments in Kuala Lumpur’s green spaces, pedestrian connectivity, and heritage assets.

The firm noted nearly RM1 billion allocated to Rumah Mesra Rakyat and Program Residensi Rakyat, alongside plans for Bandar MADANI Bukit Jalil and at least 2,500 Rumah MADANI units on government land in Belfield, Kuala Lumpur.

Additionally, 50 acres of strategically located land in Kuala Lumpur has been gazetted as Malay Reserve Land, with plans to provide another 50 acres valued at RM1 billion as a new endowment to Yayasan Pelaburan Bumiputra, with both land allocations earmarked partly for affordable housing.

Budget 2027 provides for an additional RM20 billion in housing financing guarantees under Syarikat Jaminan Kredit Perumahan, which is expected to benefit another 80,000 first-time homebuyers, particularly the self-employed. The proposed first-home stamp duty relief covers loan agreements and instruments of transfer, offering full exemption for homes priced up to RM500,000.

For first homes priced above RM500,000 and up to RM750,000, the proposal provides for full exemption on the first RM500,000 and a 50% exemption on the remaining amount. This relief would apply to sale and purchase agreements executed from Jan 1, 2027 to Dec 31, 2030.

Separately, full stamp duty exemptions are proposed for rescue developers and original purchasers of abandoned housing projects from 2027 to 2030, supporting the government’s target of eliminating abandoned housing projects by 2030. Knight Frank said the housing measures would widen access to homeownership through additional supply, financing support, and lower transaction costs.

Knight Frank stated that allocations for industrial and high-technology parks would support Malaysia’s position as a regional manufacturing and technology hub. The firm highlighted the identification of Penang as the nation’s financial technology hub, alongside an RM100 million Strategic Investment Fund to support semiconductor and manufacturing companies in the state.

Other industrial measures include maritime and automotive hubs in Perak, supported by tax deductions of up to RM5 million for eligible relocation costs; infrastructure for Malaysia Vision Valley 2.0 in Negeri Sembilan; and the continued development of Kulim Hi-Tech Park in Kedah.

Initiatives such as the proposed Sibu Special Economic Zone, Melaka Centre of Excellence, Delapan Special Border Economic Zone, and the Johor–Singapore Special Economic Zone could help attract international investment and skilled talent, according to the consultancy. It also highlighted enhancements to Global Services Hub tax incentives starting Jan 1, 2027, and the introduction of a Multi-Family Office model in Forest City, Johor.

The latter model would allow licensed fund managers to serve multiple families, including funds under approved single-family offices.

In East Malaysia, Knight Frank said Sarawak’s record RM16.2 billion federal allocation, strategic road investments, and improved regional connectivity through AirBorneo would support the state’s long-term growth. Sabah’s record RM18.7 billion allocation, the continued implementation of Pan Borneo Phase 1B and the Sarawak–Sabah Link Road, and investments in electricity reliability could strengthen infrastructure readiness and investment appeal, the firm added.

The consultancy also highlighted RM3.3 billion allocated for continued road infrastructure projects and RM350 million for federal road maintenance to improve connectivity across the two states.

In Peninsular Malaysia, progress on the East Coast Rail Link could support development along its alignment, including heavy industries in Bentong and public housing near the KotaSAS station. Knight Frank welcomed RM100 million for retention ponds and river maintenance to reduce flood risks in Selangor, alongside plans to implement the Elevated Autonomous Rapid Transit to ease congestion in Johor Bahru.

For Kuala Lumpur, the firm welcomed Kuala Lumpur City Hall's RM400 million allocation for initiatives including 120 acres of new green spaces, park conservation, public facilities, heritage preservation, and 22 kilometres of covered walkways.

The consultancy also highlighted the preservation of Menara Dayabumi and the KTMB headquarters, as well as the conservation of the Kuala Lumpur Railway Station. These initiatives could support urban regeneration and the repositioning of older commercial buildings, Knight Frank said, while also welcoming entertainment duty exemptions for arts, cultural, entertainment, and sporting activities at Stadium Merdeka and Stadium Negara.

Related: Knight Frank Malaysia