Unsold homes below RM500,000 now make up more than two-thirds of Malaysia’s completed residential overhang. That is a surprising number for a country where housing affordability remains a constant concern.
In Q1 2026, Malaysia had 32,801 completed but unsold residential units worth RM16.37 billion. Of these, 14,201 units were priced at RM300,000 and below, while another 8,283 were between RM300,001 and RM500,000. Combined, 22,484 units — 68.6% of the total — were below RM500,000.
| Price range | Unsold units | Share |
|---|---|---|
| RM300,000 and below | 14,201 | 43.3% |
| RM300,001–RM500,000 | 8,283 | 25.3% |
| RM500,001–RM1 million | 7,623 | 23.2% |
| Above RM1 million | 2,694 | 8.2% |
| Total | 32,801 | 100% |
These are conventional residential properties, including landed homes, flats, apartments and condominiums. Serviced apartments sit in a separate NAPIC category.
So Malaysia’s housing problem cannot be reduced to “developers are building homes that are too expensive”. A large part of the stock already sits at supposedly affordable prices.
The harder question is whether those homes are affordable to the people living where they were built.
NAPIC’s Q1 snapshot gives the national price breakdown and separately identifies the states with the largest overhang. It does not provide a complete state-by-price matrix in the public snapshot, so applying the national 43.3% sub-RM300,000 share evenly across every state would be misleading.
What the available data does show is that the problem stretches well beyond Klang Valley.
| State | Completed unsold homes | 2024 median monthly household income |
| Perak | 4,063 | RM4,687 |
| Johor | 3,852 | RM7,712 |
| Selangor | 3,745 | RM10,726 |
| Kuala Lumpur | 3,733 | RM10,802 |
| Penang | 3,165 | RM7,386 |
| Melaka | 2,065 | RM6,891 |
NAPIC identifies Perak, Johor, Selangor and Kuala Lumpur as the four largest overhang markets, while Penang ranked fifth with 3,165 units. Melaka separately reported 2,065 completed unsold homes based on the same Q1 2026 NAPIC data.
The income gap between those states is significant. DOSM puts Malaysia’s median monthly household income at RM7,017, but it ranges from about RM10,800 in Kuala Lumpur and Selangor to RM4,687 in Perak.
That changes how we should read unsold homes below RM500,000.
Take a RM300,000 property.
That price is equivalent to roughly 2.3 years of median gross household income in Kuala Lumpur, but about 5.3 years in Perak. At RM500,000, the comparison grows to around 3.9 years in Kuala Lumpur versus almost 8.9 years in Perak. This is a simple price-to-income comparison, not a mortgage eligibility test, but it shows how different the burden can be.
Perak is especially relevant because it has the highest number of completed unsold homes in the country while also having one of the lowest median household incomes.
A RM350,000 terrace house may appear cheap when compared with Klang Valley prices. That does not mean the local buyer sees it as cheap.
The national label “below RM500,000” therefore covers very different affordability realities.
Penang gives us a more detailed example.
Of its 3,165 completed unsold homes, 2,215 — nearly 70% — were condominiums and apartments. Its largest unsold price band was RM200,001 to RM300,000, with 708 units, followed by another 412 units between RM300,001 and RM400,000.
This is important because the unsold stock is not concentrated only in luxury housing.
A buyer may be able to afford a RM300,000 apartment and still decide against it because of the location, density, maintenance charges, layout, parking or better alternatives nearby.
That is the difference between being affordable on paper and being competitive in the actual housing market.
Land is cheaper farther from mature employment centres. That makes peripheral areas attractive for lower-priced development.
But the cost does not disappear. It moves to the buyer.
A family may pay less for the house but more for petrol, tolls and car ownership. A longer commute also carries a cost that never appears in the selling price.
This helps explain why unsold homes below RM500,000 can exist alongside genuine demand for affordable housing.
People do not need affordable homes anywhere. They need affordable homes within reasonable reach of jobs, schools, transport and family.
Johor and Selangor illustrate why state totals alone can also mislead. Both contain very different local markets. A development close to Johor Bahru or an established Selangor employment centre faces a different pool of buyers from a project much further out.
The relevant housing market is often the district or even the immediate catchment area, not the whole state.
Malaysia’s completed residential overhang is not primarily a condominium story.
NAPIC recorded 18,180 unsold landed homes, or 55.4% of the total, compared with 14,621 high-rise units.
That tells us something useful.
Even a landed home can struggle when it is built in the wrong place, offered at the wrong price for local income, or designed for demand that never materialises.
At the other end, Penang shows how lower-priced high-rise stock can remain unsold despite appearing affordable.
There is no single housing type causing the overhang. The common thread is mismatch.
The presence of unsold homes below RM500,000 does not mean Malaysians have stopped buying lower-priced property.
The broader property market still records its highest transaction volumes at the lower price end. NAPIC’s Q1 2026 snapshot shows RM300,000 and below as by far the largest transaction price band nationally.
That is what makes the overhang interesting.
Demand exists at the same time that completed stock remains unsold.
In practice, buyers may choose one RM300,000 project while rejecting another RM280,000 project nearby. They are comparing more than price: access, condition, neighbourhood, monthly costs and future resale all matter.
The issue is therefore less about whether Malaysians want affordable homes and more about which affordable homes they are willing to buy.
A large part of Malaysia’s overhang is old.
NAPIC shows that 13,429 units, or 40.9%, came from projects launched six to ten years ago. Another 3,437 units were from projects launched more than ten years earlier. Only 28.8% came from projects launched within the previous three years.
An unsold unit does not stay new simply because nobody has lived in it.
Finishes age. Waterproofing and fittings need attention. Common areas become older. New projects arrive with more current layouts and facilities.
More importantly, buyers begin asking why a completed unit has remained unsold for six or eight years.
That question becomes part of the product.
Low occupancy can add to the problem. A development with empty corridors, inactive shops or underused facilities may feel less established than an older neighbourhood with an active community and clear resale history.
For unsold homes below RM500,000, another discount may not be enough once those concerns have built up.
Older stock needs a different sales strategy from a new launch.
The first step is pricing. Developers need to compare the property with current transactions, bank valuations and nearby subsale homes rather than continue anchoring to an old launch price.
The physical product matters too. An older completed unit may need repainting, repairs and replacement fittings. Common areas and landscaping may need the same treatment. The aim should be to present a properly maintained home, not a unit that feels like leftover inventory.
Developers can also make the existing development work harder for them. A project that has been completed for years has something a new launch does not: actual evidence. Occupancy, building management, nearby amenities and established transport connections can all become selling points if they are strong.
If the original target market was wrong, that may also need to change. A project sold to investors years ago may now be better positioned for owner-occupiers.
Marketing can help sell an improved proposition. It cannot fix the underlying mismatch by itself.
This becomes relevant as major new affordable housing projects continue to be proposed.
A development planned on government land in Bukit Jalil could add 17,000 units, comprising 14,200 PR1MA homes, 1,750 Residensi Madani units and 1,050 civil-servant units. Residents have raised concerns about whether roads, utilities, parking and community infrastructure can absorb development on that scale.
The lesson from unsold homes below RM500,000 is not that Malaysia should stop building affordable housing.
It is that the number of units announced cannot be the main measure of success.
Before building 5,000 or 17,000 more homes, the more important questions are who will buy them, what those households earn, where they work, what competing stock already exists nearby and whether the surrounding infrastructure can support them.
NAPIC itself says better supply-and-demand information should allow developers to make better investment decisions and gradually reduce overhang.
The numbers tell a more specific story.
Unsold homes below RM500,000 dominate the national residential overhang, but that does not prove Malaysia has enough affordable housing.
Perak shows why local income matters. Penang shows that lower-priced high-rise housing can still miss demand. Selangor and Johor show why location within a state matters. Kuala Lumpur shows that even relatively higher-income markets can carry substantial unsold stock. Melaka’s 2,065 unsold units show that the issue extends beyond the largest property markets.
Meanwhile, the age of the stock suggests part of the problem has been building for years rather than appearing overnight.
Malaysia still needs affordable housing. But unsold homes below RM500,000 show that affordability cannot be reduced to a price ceiling.
A successful home has to match local income, buyer needs, employment patterns and location.
The real target should not simply be more homes below RM500,000.
It should be the right homes, at locally affordable prices, in places where people actually want and need to live.
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