The Belanjawan Madani 2026, presented by Prime Minister Datuk Seri Anwar Ibrahim, is one of Malaysia’s most comprehensive fiscal plans to date. It is more than just an annual financial statement, it is a roadmap to strengthen economic foundations, improve public infrastructure, and promote inclusive growth for all Malaysians.

With a total allocation of RM470 billion, including RM81 billion for development, the Budget underscores the government’s commitment to build a sustainable, equitable, and digitally empowered Malaysia. For the property sector, it outlines clear strategies to boost affordable housing, urban redevelopment, infrastructure modernization, and digital transformation, all of which directly influence property values, homeownership opportunities, and investment sentiment.

Belanjawan 2026: How the Budget Impacts Malaysia’s Property Market

1. National Development and Housing

• RM6.088 billion – Allocation for the Ministry of Housing and Local Government (KPKT)

↑ 2.6% increase from 2025 allocation

• RM100 million – Fund to repair and upgrade low- and medium-cost housing, covering roofing, wiring, CCTV, and water tanks
• RM300 million – For DBKL public housing (PPR) maintenance and facility improvements
• RM200 million – To upgrade public markets, hawker centres and food courts under the Urban Regeneration & Heritage Project
• RM500 million (internal DBKL fund) – To modernize older facilities and PPR housing in Kuala Lumpur

A central component of Belanjawan Madani 2026 is its RM81 billion in development expenditure, aimed at building and maintaining Malaysia’s physical foundation such as roads, housing, drainage, and utilities.

DBKL’s Expanded Role in Urban Housing

For urban dwellers, especially in Kuala Lumpur, the budget provides RM300 million to DBKL (Kuala Lumpur City Hall) for the maintenance and upgrading of public housing (PPR) buildings.
This includes improvements to:

• Wiring systems and old electrical infrastructure
• Road resurfacing and parking areas in PPR compounds
• Lift and facility replacements in ageing public flats

The government also created an internal DBKL fund of RM500 million, dedicated to upgrading old urban infrastructure and residential amenities. Out of this, RM200 million is earmarked for market and hawker centre regeneration, enhancing community commerce spaces and local economies.

Balancing Infrastructure and Livability

Beyond Kuala Lumpur, RM27 billion has been allocated nationwide for roads, bridges, and drainage systems. These projects may not sound glamorous, but they directly influence:

• Flood prevention (a recurring risk in Klang Valley and coastal cities)
• Travel time and accessibility, improving connectivity to emerging property corridors
• Land value stability, since infrastructure upgrades reduce long-term risk for investors and developers

The combination of improved physical infrastructure and community redevelopment underlines Malaysia’s long-term vision: growth with livability making cities not just bigger, but better.

2. Affordable Housing and Market Incentives: Expanding Supply and Stability

Housing affordability remains one of Malaysia’s biggest socio-economic challenges. Belanjawan Madani 2026 tackles this through targeted repair funding, construction cost control, and administrative efficiency.

Strengthening Affordable Housing Supply

The Ministry of Housing and Local Government (KPKT) receives RM6.088 billion, reflecting the government’s continued focus on public housing.
This allocation supports:

• Affordable home construction under PPR (Program Perumahan Rakyat) and PRR (Program Rumah Rakyat).
• RM100 million fund to repair and upgrade low- and medium-cost homes including roofing, water tanks, wiring, and security installations (like CCTV).

This effort improves housing safety and extends the lifespan of Malaysia’s large stock of public flats, especially in older neighborhoods.

Construction Cost Stabilization

Rising construction costs have pressured developers, especially those delivering affordable housing. The government’s targeted subsidies and price controls for critical materials aim to stabilize this.
Additionally, import cost monitoring via Customs and the Centralised Screening Complex (CCTV) is expected to reduce leakages and manipulation in building material imports.

For developers, this translates to:

• More predictable project budgeting
• Reduced risk of material price spikes
• Greater incentive to build affordable units

Transaction Transparency: e-Invoicing and Stamp Duty Reforms

Starting 2026, the national e-Invoicing system will be fully implemented across all sectors, including property transactions. Together with a stamp duty self-assessment system, this will:

• Simplify property transfer processes
• Reduce administrative delays for buyers
• Improve tax compliance for developers and agents

3. Urban Regeneration and Heritage Redevelopment

Urban renewal takes a strong position in Belanjawan Madani 2026. The government recognizes that Malaysia’s historic districts, particularly in Kuala Lumpur, hold economic and cultural potential if properly restored.

Major Heritage Projects

Under Khazanah Nasional’s urban investment initiative:

• RM600 million – Allocated to Khazanah Nasional for restoration and adaptive reuse of:
  • Carcosa Seri Negara
  • Bangunan Sultan Abdul Samad
• RM5 million – Matching grant for rejuvenation of the National Museum
• Heritage projects under Warisan KL include Dayabumi Complex, Textile Museum, and Kuala Lumpur Railway Station (funds under the same RM600 million pool)

Urban Commercial Renewal

DBKL will channel RM200 million for hawker centre and public market upgrades. This initiative supports local traders, promotes tourism, and enhances Kuala Lumpur’s image as a modern, livable, and culturally rich city.

Economic Impact of Urban Regeneration

Urban regeneration tends to raise the value of adjacent properties due to:

• Improved public spaces and tourism traffic
• Business revitalization in city centres
• Better safety, lighting, and infrastructure

This approach supports the Madani principle economic growth that preserves cultural identity.

4. Sabah and Sarawak: Bridging the Regional Gap

For the first time, Sabah and Sarawak receive record allocations in Budget 2026, a strong signal that the federal government is serious about balanced regional development.

Development Allocations

• Sabah: RM6.9 billion
• Sarawak: RM6.0 billion
• MA63 Special Grant: Increased to RM600 million

Key Projects in Borneo

• Pan Borneo Highway, Sarawak–Sabah Link Road (SSLR), and Trans Borneo Highway (LTB): Major projects improving logistics and regional accessibility.
• RM1 billion Sabah Water Project: Upgrading old pipelines and water distribution systems.
• RM2 billion SALAM Submarine Cable Project: Boosting internet access between Peninsular Malaysia, Sabah, and Sarawak.

These projects will unlock new land corridors, enabling industrial and residential development along previously underdeveloped routes. Improved connectivity also means better job mobility, supporting local economies and reducing rural–urban migration pressures.

5. Construction Inflation, Integrity, and Transparency

Rising material costs and procurement inefficiencies have long troubled Malaysia’s property sector. Belanjawan Madani 2026 introduces several mechanisms to control inflation, enforce transparency, and strengthen fiscal discipline.

Governance and Oversight

The government allocates RM700 million to strengthen enforcement and integrity agencies:

• MACC (Malaysian Anti-Corruption Commission)
• Customs (JKDM)
• Police (PDRM)
• KPDN (Domestic Trade Ministry)
• MyCC (Competition Commission)
• Establishment of Centralised Screening Complex (CCTV) by Customs to monitor high-risk imports

The goal is to reduce corruption risks and cost leakages in public procurement.

e-Invoicing and Procurement Modernization

By requiring electronic documentation across project pipelines, the e-Invoice system will reduce under-declaration and enhance pricing transparency. Together with the Fiscal Responsibility Act, these reforms support a more sustainable and accountable construction sector.

Benefits for Developers and Buyers

• Lower material cost volatility
• More confidence in public-private construction partnerships
• Greater transparency in pricing for end consumers

6. Digital Transformation and Tax Reform

Digitalization remains a major theme in Budget 2026. By integrating technology into public services and tax administration, Malaysia aims to create a smarter, faster, and fairer system for both citizens and businesses.

MyDigital ID and Kiosk MADANI

The MyDigital ID platform expected to reach 15 million users by 2026 will serve as a single identity for digital public services. Complementing this, Kiosk MADANI outlets will be installed nationwide to improve access to government services, especially in rural areas.

GovTech Malaysia

The GovTech system will streamline project approval and monitoring, reducing bureaucracy in development projects, a key benefit for property developers managing approval timelines.

Tax Reforms

Tax exemptions for luxury vehicles in duty-free zones like Langkawi and Labuan will now be capped at RM300,000 to prevent misuse. This reflects a broader principle of fair taxation and responsible incentives balancing growth with social equity.

7. Toward a Sustainable and Balanced Property Market

The Belanjawan Madani 2026 is more than a fiscal document, it’s a roadmap for economic inclusivity and sustainable growth. By strengthening housing infrastructure, regional connectivity, and financial governance, it lays the foundation for a resilient property market that benefits both urban and rural Malaysians.

• For homebuyers, it means safer, better-maintained homes, improved access to affordable housing, and fairer property processes.
• For developers, it offers clarity, policy stability, and stronger institutional trust.
• And for investors, it signals long-term confidence in Malaysia’s real estate and infrastructure-driven growth.

Fiscal & Economic Highlights

• Total national revenue (2026): RM343.1 billion
• Fiscal deficit target: 3.8% of GDP
• GDP growth projection: 4.0 – 4.5%
• Inflation rate: 1.5 – 2.3%

 

The Belanjawan Madani 2026 underlines Malaysia’s commitment to balance fiscal discipline with social well-being. With strong allocations to housing, infrastructure, and digital governance and a firm stance against corruption, this budget provides the foundation for a property sector that is not only profitable, but equitable and sustainable.

As Malaysia modernizes its cities and expands development into Sabah and Sarawak, the property landscape is entering a new phase, one defined by inclusivity, accountability, and opportunity for all.