Budget 2026: Transport Upgrades to Drive Property Growth Across Malaysia
Malaysia’s Budget 2026, worth RM419.2 billion, is more than just a financial roadmap — it’s a forward-looking plan to enhance urban mobility, reduce congestion, and connect key growth regions. With nearly RM200 million allocated to the public transport sector, the government is paving the way for stronger urban connectivity and sustainable growth — factors that consistently drive Malaysia property investment.
Announced by Prime Minister Datuk Seri Anwar Ibrahim, who also serves as Finance Minister, this “Fourth Madani Budget” focuses on long-term stability through digitalisation, infrastructure renewal, and inclusive growth. For property buyers and investors, especially in Kuala Lumpur and Johor Bahru, the renewed emphasis on rail, bus, and green mobility translates directly into enhanced accessibility, rising property demand, and sustained value appreciation.
1. Public Transport Boosts Urban Liveability
The nearly RM200 million allocation under Budget 2026 will modernise bus networks, improve urban-rural connectivity, and strengthen last-mile transport solutions. This investment includes new stage bus routes in underserved areas and expanded capacity in high-density corridors — ensuring smoother, more reliable mobility across major cities.
In tandem, Rural Air Services (RAS) subsidies worth RM209 million will continue to maintain air links in Sabah and Sarawak, connecting remote communities to key economic hubs. These initiatives signal a broader national agenda: creating seamless connectivity that uplifts both liveability and property market performance.
2. Rail Expansion: A Catalyst for Property Value
Malaysia’s rail network is undergoing its most significant expansion in years — a major tailwind for property investors. The government’s Budget 2026 roadmap outlines multiple rail projects that are set to redefine commuting patterns and real estate potential across the country.
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Electric Train Service (ETS): Set to reach Kluang by August 2025 and Johor Bahru Sentral by year-end, transforming southern corridor accessibility. This positions Johor — especially the JS-SEZ (Johor-Singapore Economic Zone) — as a rising hotspot for transit-oriented property investments.
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Light Rail Transit 3 (LRT3): Connecting Bandar Utama to Johan Setia by end-2025, this line will serve 6,200 passengers per hour per direction, easing congestion and raising property demand in Shah Alam, Klang, and Damansara.
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East Coast Rail Link (ECRL) Phase 1: Expected completion by end-2026, cutting travel time from Kelantan to Kuala Lumpur to just four hours — a game-changer for property and tourism along the east coast.
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Klang Valley Double Track Phase 2 (KVDT2): Spanning Bandar Tasik Selatan–Seremban and Simpang Pelabuhan Klang–Port Klang, with completion by 2029. This RM4.1 billion project will boost suburban housing appeal through better train frequencies.
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Penang LRT (Mutiara Line): Soon to begin, this project will benefit 1.8 million residents and millions of annual visitors, catalysing property values across the island and mainland.
In Kuala Lumpur, the LRT Kelana Jaya Line will add 26 new trains worth RM1 billion, increasing frequency and reliability — a major draw for professionals and renters living near transit nodes like Bangsar, Subang Jaya, and Kelana Jaya.
3. Bus and Van Upgrades: Making Mobility Inclusive
Under Prasarana Malaysia Bhd, 310 new buses will join high-demand routes by February 2026, while 300 Demand Responsive Transit (DRT) vans will serve flexible, app-based routes by end-2025.
More importantly, Malaysia is aligning this expansion with green mobility targets:
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1,450 electric buses and 300 electric vans will be added progressively until 2030.
These upgrades will not only reduce emissions but also improve accessibility for daily commuters — an essential quality-of-life metric that enhances property desirability near key public transport corridors.
4. Safer, Smarter Roads Nationwide
To complement public transport investments, the government has allocated RM2.5 billion for federal road maintenance, covering pothole repairs, lighting upgrades, and safety enhancements. A further RM5.6 billion will be channelled to state governments under MARRIS, supporting regional road improvements.
The introduction of 3,000 LED lights in high-risk areas and accelerated tax allowances for heavy vehicles with speed limiters highlight a broader safety-driven approach — ensuring that as mobility expands, road conditions keep pace.
District Engineers are also empowered with RM30 million for immediate small-scale works, supported by the MyJalan app, allowing the public to directly report road issues for rapid response.
5. Greater Accessibility Equals Stronger Property Potential
For property investors, these transport upgrades are more than infrastructure news — they’re value multipliers. History shows that proximity to rail and public transport consistently correlates with higher rental yields and resale premiums, especially in Kuala Lumpur’s evolving transit corridors.
The upcoming LRT3, ECRL, and KVDT2 lines will not only shorten commute times but also unlock new investment nodes along the Klang Valley and beyond. Similarly, the Johor Bahru-Singapore RTS integration will supercharge cross-border property demand, especially near Bukit Chagar and the Iskandar region.
By 2026, buyers can expect new appreciation zones to emerge around transit hubs — from Gombak to Klang, JB Sentral to Iskandar Puteri, and Bangsar South to Kinrara. These pockets are poised to attract both tenants and investors seeking connected, modern lifestyles.
6. A Greener, Smarter Malaysia on the Move
Budget 2026’s emphasis on electric mobility and renewable energy reflects a decisive shift towards sustainability. By aligning public transport upgrades with green vehicle adoption, Malaysia is building a low-carbon urban future that integrates cleaner commutes with smarter city living.
For property developers, this signals opportunity: transit-oriented, green-certified developments are likely to see higher demand and stronger financing support in the coming years.
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