LOAN applications for property purchases picked up in July, pointing to a modest recovery in buying interest despite continued caution among consumers facing elevated living costs and persistent inflationary pressures.
Total loan application for purchase of property climbed to RM62.9 bil in July 2026 after remaining largely flat in June 2026 with marginal growth of +0.1% month-on-month.
“We believe the stronger performance in July 2026 reflects a normalisation in loan application activity following the disruptions from school holidays and public holidays in May and June,” said MBSB Research.
On a year-on-year (yoy) basis, total loan application was flattish (+0.6% yoy) in July 2026 after a decent increase of +7.8% yoy in June 2026.
That brought cumulative total loan applications in the seven months of 2026 to RM382.5 bil (+2.2%yoy).
Property demand has remained relatively steady, although buyers are still taking a cautious approach as the cost of living remains elevated.
With inflationary pressures likely to persist, purchasing sentiment could remain subdued in the coming months.
The latest earnings season delivered a mixed performance among property developers.
Of the seven companies under our coverage, four recorded results that were broadly in line with expectations, while one outperformed and two fell short of forecasts.
IOI Properties Group was among the stronger performers, with its earnings exceeding expectations following the recognition of land sale proceeds from its Ampang development.
In contrast, S P Setia and UOA Development Group underperformed expectations, largely due to weaker margins during the first half of 2026.
On a quarter-on-quarter basis, most property companies saw an improvement in earnings, supported by a recovery in progress billings after a relatively subdued first quarter.
Property sales also picked up in quarter two financial year 2026 (2QFY26), following softer activity in 1QFY26 amid the festive period.
Despite the sequential improvement, the overall earnings picture remained uneven.
While certain developers benefited from gains arising from land transactions, others continued to face pressure from narrowing margins and operational challenges.
MBSB maintains its Neutral stance on the property sector as there are currently limited near-term catalysts capable of driving a meaningful improvement in sector performance.
That said, earnings visibility remains relatively healthy, supported by developers’ existing project pipelines and sizeable unbilled sales.
However, continued inflationary pressures and rising household expenses could weigh on consumers’ purchasing power.
As a result, buyers are likely to remain selective, potentially leading to more cautious property purchases and slower sales momentum in the near term.—Sept 7, 2026
Main image: property24.com
