boongiap.com.my
Malaysia’s Budget 2026 is not just numbers on paper – it reshapes how locals and foreigners buy, finance and invest in property for the next few years. For homebuyers, it is about affordability and access; for investors, it is about a clear shift away from speculation toward stable, sustainable growth.
Key housing measures you should know
Budget 2026 introduces several important housing‑related measures with a clear focus on affordability and access:
- Full stamp duty exemption on both MOT (transfer) and loan agreement for first‑time homebuyers purchasing properties up to RM500,000, extended until 31 December 2027.
- Expansion of the Housing Credit Guarantee Scheme (SJKP) to RM20 billion, expected to assist around 80,000 first‑time buyers including gig workers and self‑employed individuals who lack traditional income proof.
- Extension of the Youth Housing Financing Scheme (LPPSA) until 2026, with the financing limit increased to RM1 million to support about 48,000 young civil servants in buying or upgrading homes.
Together, these measures reduce upfront costs and widen access to financing – especially for genuine owner‑occupiers in the low‑ to mid‑price segments and younger demographics. This also supports overall transaction volume in the affordable and mid‑market housing tiers over the next two years.
Big change for foreign buyers
On the other side, Budget 2026 significantly raises the barrier for non‑citizen buyers of Malaysian residential property:
- Stamp duty on instruments of transfer for residential property purchased by non‑citizens, non‑permanent residents and foreign companies is increased from 4% to 8%.
- The objective is to curb speculative demand from foreign buyers and prioritise local home ownership in key urban markets such as Kuala Lumpur, Johor Bahru and Penang.
Consultancy analyses note that this will likely dampen some high‑end foreign demand but is not expected to heavily impact non‑urban or purely local markets. For foreign investors, it means factoring in a materially higher entry cost on residential deals from 2026 onwards, while also negotiating harder with developers on incentives or stamp duty sharing.
Incentives for repurposing ageing buildings
Budget 2026 also incentivises adaptive reuse, which can create new residential opportunities in established urban areas:
- A special tax deduction of up to 10% of eligible expenses (capped at RM10 million) is offered for renovation and conversion of commercial buildings into residential premises.
- The goal is to encourage landlords and developers to turn under‑utilised offices and shoplots into housing, easing supply constraints in city centres.
If implemented well (with supportive planning and financing frameworks), this could unlock new city‑centre residential stock at more reasonable prices, especially in older business districts. For investors, it opens niche opportunities in conversion projects that may benefit from both the tax incentive and renewed demand for well‑located urban living.
What this means for buyers and investors
For Malaysians, Budget 2026 clearly favours first‑time and genuine owner‑occupier demand: lower entry costs, easier financing and more pathways into homeownership. For foreign buyers and high‑end urban investors, the message is more selective: higher stamp duty on residential property, but continued support for long‑term, sustainable and green‑aligned investments – especially in industrial and modern, energy‑efficient projects.
Overall, Budget 2026 signals a policy shift from short‑term speculation toward a more stable, people‑centric and sustainability‑driven property market, which serious long‑term investors and homebuyers can use to their advantage.