KUALA LUMPUR: Malaysia's property market remains resilient and poised for long-term growth despite global inflation, geopolitical tensions, and economic instability that may impact market sentiment.

Experts attribute this to the country's strategic location, cultural richness, and supportive government policies, which continue to attract both investors and homeowners.

Knight Frank Malaysia executive director Amy Wong said the focus for this year will be particularly the industrial sector, as the government policies are driving foreign direct investments (FDI) into the country.

"Foreign investments mean manufacturing plants, bringing in multinational corporations (MNCs) to set up their operations here.

"The Klang Valley, Johor, Penang, and even Sarawak and Sabah are gaining increased interest due to their strategic advantages.

"With all these chess pieces in place, I think 2025 is going to be a good year for the property market," she said at Bursa Malaysia- Hong Leong Investment Bank (HLIB) 18th Stratum Focus Series here, today.

According to the National Property Information Centre (NAPIC), property transaction values reached a five-year high of RM105.65 billion in the first half of 2024, recording a remarkable 23.8 per cent year-on-year increase.

This growth, coupled with a 12.3 per cent reduction in residential overhang, signals a recovering market driven by improving demand and affordability.

HLIB chief executive officer Lee Jim Leng said affordability remains a key element in determining the property sector's future outlook.

In 2025, Lee said the firm expects higher wages for civil servants and the introduction of a higher minimum wage in February will increase disposable income, catalysing demand for properties across the country.

"This, coupled with the current 3 per cent overnight policy rate (OPR) and stable mortgage rates, creates a favourable environment for both homebuyers and investors, making homeownership more accessible," said Lee.

Meanwhile, Lee said the firm believes with a stable employment growth rate and a projected gross domestic product (GDP) growth of 4.9 per cent this year, the economy remains on firm ground.

She said these positive indicators provide the right conditions for sustained growth and a virtuous cycle of demand and investment that contributes to Malaysia's broader economic development.

"While these are promising signs, it is necessary for continued innovative strategies and collaboration within the industry to tackle the challenges," she added.