DATA released by Bank Negara Malaysia shows that total loan application for purchase of property recorded double digit growth of +12.2% year-on-year (yoy) in September 2025 following increase of +6.9% yoy in August 2025.
The double-digit growth in loan application shows that buying sentiment on property remains resilient. That brought the total loan application higher at RM490bil (+3% yoy) in the nine months of calendar year 2025 (9MCY25).
“On a monthly basis, loan application was weaker by -9.6% month-on-month (mom) which we opine was due to school holidays and public holidays in September,” said MBSB Research.
Going forward, MBSB Research expects loan applications to recover in October 2025. Overall, they maintain their view that buying interest of properties will be stronger in 2025 as outlook for property market in Malaysia remains positive with stable house prices in Malaysia.
Approved loan for purchase of property increased by +8.7% yoy in September 2025, snapping three consecutive declines in June 2025 to August 2025.
The increase in approved loans was mainly due to higher loan application which cushioned the marginally lower loan approval ratio. On a monthly basis, approved loans declined by -13.6% mom, owing to lower loan application and lower loan approval ratio.
For the upcoming earnings release of property companies, MBSB expects most of the property companies to record earnings growth in quarter three calendar year 2025 (3QCY25) as progress billing of ongoing projects remain stable while earnings recognition from higher sales achieved in CY24 should support earnings growth.
“Meanwhile, we expect earnings momentum to sustain in 3QCY25 following a decent 2QCY25,” said MBSB.
The earnings growth was largely driven by the acceleration of progress billing of property projects and cost savings. Meanwhile, most of the developers are targeting higher sales in CY25 as market conditions are favourable with stable demand for property.
“Hence, we see better earnings outlook for developers from CY25 onwards,” said MBSB.
The growth in loan application is positive to the sector as it indicates that buying interest on property remains resilient which is in line with MBSB’s expectation of stronger buying interest in 2025.
Besides, overnight policy rate is maintained at 2.75% which MBSB believes is positive to the sector as buying interest on property is expected to remain supported.
“Overall, we maintain our Positive stance on the property sector as we think that the upcoming Johor-Singapore RTS link, JS-SEZ, and the development of industrial properties in Malaysia will sustain growth of the property sector,” said MBSB. —Nov 12, 2025
Main image: iInsight
