With strategic developments accelerating across Johor Bahru and the Iskandar Malaysia region, the state is set to benefit from growth in the residential, commercial, and industrial sectors, according to Henry Butcher Malaysia.

Catalytic infrastructure improvements, along with heightened tourism appeal, are expected to drive this momentum further.

While geopolitical uncertainties remain a concern globally—potentially impacting investment flows and supply chain stability—they also create openings for emerging logistics hubs. Johor, with its strategic location and evolving infrastructure, is well-positioned to capitalise on such shifts, offering itself as a regional trade and logistics centre and a safe-haven destination for property investments.

Johor's strengthening economic ties with Singapore—bolstered by the upcoming Rapid Transit System (RTS) Link, the Johor-Singapore Special Economic Zone (JS-SEZ), and the Special Financial Zone (SFZ)—are reinforcing its attractiveness to investors.

Combined with the twin-city synergy between Johor Bahru and Singapore, these developments are supporting strong and growing demand in key urban areas.

Key investment themes for 2025

According to Henry Butcher Malaysia, several themes are set to shape Johor's property investment landscape:

i) Data Centres: Rising demand for data infrastructure is expected to attract more foreign direct investment, strengthening Johor's position in the digital economy.

ii) Manufacturing & Electronics: Johor's industrial zones are well-suited for continued expansion in high-tech manufacturing, particularly semiconductors, leveraging proximity to Singapore.

iii) Logistics & Trade: Enhanced connectivity via the RTS Link and port upgrades positions Johor as a strategic logistics hub.

iv) Real Estate: Robust demand for properties, particularly in Johor Bahru and Iskandar Malaysia, is expected to continue due to economic growth and locational advantages.

v) Tourism & Hospitality: Leisure and medical tourism are on the rise, with Johor Bahru benefiting from its proximity to Singapore and expanding lifestyle offerings.

Residential outlook and overhang trends

In 2025, Johor Bahru's residential overhang is projected to ease, supported by the ongoing stamp duty exemption for homes priced between RM500,001 and RM1 million, as introduced in Budget 2024.

With the stamp duty exemption timeline extended to the end of 2025, this targeted assistance has already shown signs of benefiting both the first-time home buyers and property developers. Johor Bahru's high-rises have, in fact, seen a decline in their unsold inventory, with the RTS Link singled out as a possible leading factor behind this take-up rate.

In light of the above, Johor's once alarming overhang status is expected to improve over time and stabilise in 2025 should the market be aided with the right supply adjustments, Henry Butcher said.

Meanwhile, Singaporean interest in Johor's property market has grown significantly, driven by comparatively lower costs and improved lifestyle amenities. Unlike past cycles, the current wave includes high-net-worth individuals seeking both second homes and investment opportunities.

Foreigners are also drawn to Johor by infrastructure upgrades, expanded tourism offerings, and immigration incentives such as the 30-day visa-free entry for Chinese nationals (extended to end-2026) and the revamped 3-tier Malaysia My Second Home (MM2H) programme.

Particularly, the Platinum and Gold tiers of MM2H have been instrumental in drawing high-value investors to Johor's affordable, well-connected properties.

Areas of strong performance

In 2024, several locations stood out for their property performance:

Market performance of places of foreigners' favourites, such as Taman Molek, Ponderosa, Leisure Farm, East Ledang, Ledang Heights, Sunway Iskandar, Medini and Forest City showed strong market demand.

Johor Bahru's central business district and the general Iskandar Malaysia region also received strong demand attributed to the RTS Link and the JS-SEZ. This trend is expected to continue in 2025 with possibilities of doing better than in 2024, Henry Butcher Malaysia said.

The following is a brief summary that characterises each region according to its location:

i) Johor Bahru remained popular due to its proximity to Singapore, supported by the ongoing infrastructure improvements.

ii) Iskandar Puteri attracted high-net-worth individuals owing to its luxury and smart city developments.

iii) Medini has grown into a business and tourism hub.

iv) Kulai & Senai sealed its reputation as an industrial powerhouse.

v) Desaru leveraged its natural tendencies for leisure tourism and attracting an increasing number of foreign visitors in 2024.

In addition to the locations mentioned above, Gerbang Nusajaya and Kota Iskandar are emerging as attractive destinations for foreigners seeking casual visits or even mid- to long-term stays. These localities share the same factors that bolster Johor's appeal, aligning closely with the vision outlined in the Iskandar Malaysia blueprint introduced in 2006. Nearly two decades later, the economic pillars identified in that blueprint remain central and have evidently driven growth in recent years. The same factors are expected to continue shaping the region's progress in the years ahead, with 2025 looking to be a better year for the mentioned locations.

Barring unforeseen challenges, 2025 is poised to see sustained demand for affordable and mid-range properties in Johor. Interest is expected to grow among Singaporeans and participants of the MM2H programme. Integrated developments that blend residential, commercial and leisure spaces are anticipated to redefine the market and gain traction. Meanwhile, the RTS Link will also enhance cross-border connectivity, solidifying Johor's position as an attractive destination for local, Singaporean and international buyers.

With urbanisation, streamlined border clearance processes and the completion of key infrastructure projects right on track, Johor's residential property market is set for steady growth in 2025.

Outlook for 2025

i) Johor's property market is expected to perform better.

ii) Johor's residential property market is set for steady growth.

iii) The commercial property market in Johor is anticipated to see moderate growth.

iv) Johor's retail property market is expected to thrive.

v) The hospitality market in Johor is looking to remain stable.

vi) Johor's serviced apartments sub-sector is anticipated to sustain growth.

vii) Johor's industrial property market is expected to remain positive and grow.

Factors to Watch in 2025

i) Rapid Transit System (RTS) Link, connecting Singapore to Johor Bahru.

ii) Special Financial Zone (SFZ) status designated for Forest City and Medini City in Iskandar Puteri.

iii) Attention from data centre players.

iv) The Johor-Singapore Special Economic Zone (JS-SEZ).

v) Kuala Lumpur-Singapore High-Speed Rail (KL-SG HSR).

vi) Geopolitical risks and global economic uncertainties, causing currency and regional trade fluctuations.

vii) Cross-border business dynamics, especially from Singapore.

Bright Spots in 2025

i) Proximity to Singapore boosting trade and investment opportunities.

ii) Economic integration between Malaysia and Singapore drives growth in real estate and industrial and commercial sectors.

iii) JS-SEZ in Iskandar Malaysia and the Pengerang area and the SFZ in Forest City.

iv) Johor's affordability attracts regional and global investors.

v) Johor Bahru city centre and the RTS Link's surrounding areas.

vi) Projects like the RTS Link, highways and port upgrades will enhance connectivity.

vii) The Gemas–Johor Bahru Electrified Double Track Project (Gemas-JB EDTP) is expected to be fully completed by April 2025.

viii) Johor Bahru has experienced a notable increase in high-rise developments (serviced apartments/apartments), encompassing newly completed, ongoing and planned developments.

ix) Johor Bahru – city centre, areas within new development projects and sea-fronting areas.

x) Iskandar Puteri region and Kulai areas.

xi) Hotel Sheraton Johor Bahru, scheduled to open in 2025.

With infrastructure milestones on the horizon, favourable policies in place, and continued interest from regional investors, Johor's property market is expected to see steady and sustained growth throughout 2025.