Net Yield by Area: Johor vs KL vs Penang (2026)

Property agents across Malaysia will quote you 5-6% gross yield in Johor, KL, and Penang alike. At the gross level, these three markets look almost identical. That impression is wrong — and it's costing investors real money every month.

Gross yield ignores 12 recurring costs that landlords actually pay: mortgage, maintenance, vacancy, insurance, assessment, quit rent, agent fees, rental tax, repairs, and more. Once you deduct all of them, the three regions tell very different stories. One has 2.5x more cashflow-positive options than the others. One has the cheapest entry. One is nearly impossible for foreigners.

We ran the same 12-cost cashflow model across all three regions using real listing and rental data. Here is what the numbers say.

Why Gross Yield Comparisons Are Misleading

Every property seminar in Singapore and Malaysia opens with a gross yield comparison slide. Johor: 5.5-6.5%. KL: 5.0-6.5%. Penang: 5.0-6.0%. The implication is that all three are roughly equivalent — pick whichever city you like.

This framing obscures the factors that actually determine whether a property puts money in your pocket or drains it:

• Maintenance fees vary wildly. A Johor high-rise at RM 0.30/sqft/month has a very different cost structure than a KL luxury condo at RM 0.55/sqft. That difference alone can swing a property from positive to negative.
• Vacancy rates differ by region. KL's deep expat and corporate tenant pool means shorter vacancies. Johor's thinner rental market means some developments sit empty for 2-3 months between tenants.
• Foreigner cost structures are not equal. Penang charges an additional 3% state levy on top of the national 8% foreign buyer stamp duty — 11% total. That alone kills the cashflow math on most Penang properties for foreign buyers.
• LTV differences compound. Malaysian buyers at 90% LTV have a fundamentally different cashflow profile than foreigners at 70% LTV on the same property.

The only honest comparison is net cashflow after all costs. Gross yield is a marketing number, not an investment number.

The Data: How We Screened 130,000+ Listings

We pulled over 130,000 active sale listings from major Malaysian property portals and matched each against rental comparables in the same building or development. Only listings with credible rental data — actual comparable rents, not agent estimates — survived the matching step.

Each matched property then ran through a 12-cost cashflow model that deducts every recurring cost a landlord pays:

1. Mortgage payment (conventional ~4.5% or Islamic ~4.0%, 35-year tenure)
2. Maintenance fee + sinking fund
3. Assessment rate (cukai pintu)
4. Quit rent (cukai tanah)
5. Fire/homeowner insurance
6. MRTA or MLTA provision
7. Vacancy allowance (1 month per year)
8. Agent letting fee (amortized)
9. Minor repair provision
10. Rental income tax (at marginal rate)
11. Furniture depreciation allowance
12. Property management provision (if applicable)

The same model runs twice: once for Malaysian buyers (90% LTV, tiered stamp duty) and once for foreign buyers (70% LTV, 8% flat stamp duty, higher profit rate). This ensures fair comparison across regions and buyer types.

A property is "cashflow-positive" only if monthly rental income exceeds all 12 costs. No rounding, no "close enough."

Head-to-Head: Johor vs KL vs Penang

This is the comparison that matters. Same methodology, same cost model, same date — the only variable is the region.

Malaysian Buyers

Foreign Buyers

Three patterns are immediately visible:

KL dominates on volume. 456 cashflow-positive properties for Malaysians — 2.5x Johor and nearly 30x Penang. More options means more ability to diversify, more bargaining power, and less risk of overpaying for a thin market.

Gross yield is nearly identical; net cashflow is not. All three regions cluster around 5.7-6.0% gross. But KL's median surplus (RM 567/month) exceeds Johor (RM 481) and Penang (RM 482). The gap comes from KL's deeper rental market translating to lower effective vacancy and more reliable tenant matching.

Penang is severely constrained. Only 16 cashflow-positive properties for Malaysians, 12 for foreigners. The numbers are too thin for most investors to build a meaningful position.

Johor: Cheapest Entry, Singapore Upside

Johor's 178 cashflow-positive properties offer the lowest median entry price of the three regions at RM 475,000. For a Malaysian buyer at 90% LTV, that is approximately RM 47,500 down payment — roughly RM 15,500 less than a median KL property.

The investment thesis for Johor rests on two infrastructure catalysts that are not speculative. Both are funded and under construction:

RTS Link connects Bukit Chagar (JB) to Woodlands North (Singapore) in approximately 5 minutes. Expected completion: 2026-2027. This creates a new tenant class — Singaporeans and PRs who work in Singapore but live in Johor, earning in SGD and paying rent in MYR. That is a structurally strong tenant profile for landlords. Read our full analysis in Johor Property for Singaporeans: RTS and Costs.

JS-SEZ (Johor-Singapore Special Economic Zone) includes corporate tax incentives and streamlined cross-border work permits. The commercial spillover will generate local employment demand that supports rental markets beyond the cross-border commuter segment.

Top Johor Performers Under RM500K (Malaysian Buyers)

These are real properties generating RM 900+/month surplus at entry prices below RM 350,000. The confidence score reflects the depth of rental comparables — HIGH means multiple recent rental transactions in the same development; MED means fewer comparables but consistent pricing.

The Johor risk: Thin rental markets in certain developments. Johor does not have KL's volume of corporate tenants and expats. If your specific development has poor tenant demand, a 2-3 month vacancy wipes out several months of surplus. The RTS Link will help — but it hasn't opened yet. Buying based on what the rental market is today, not what it might become, is the conservative approach.

Kuala Lumpur: Most Options, Deepest Liquidity

KL's 456 cashflow-positive properties make it the largest opportunity set by a wide margin. The median entry price is higher at RM 630,000, but the tradeoff is clear: deeper tenant liquidity, more rental comparables, and higher median surplus.

Why KL's surplus is highest: The city's tenant pool includes multinational employees, embassy staff, university students, medical tourists, and a large domestic professional class. This depth means landlords rarely wait more than 2-4 weeks to fill a vacancy at market rate. Shorter vacancy periods directly increase net cashflow — and that advantage compounds every year.

More comparables means higher confidence. When a KL property shows RM 3,050/month rental, that figure is backed by dozens of recent transactions in the same building. In Johor or Penang, the same figure might rest on 3-5 comparables. More data points mean less estimation risk.

Top KL Performers (Malaysian Buyers)

Note the range. Setia Sky Seputeh is a premium asset generating RM 5,328/month surplus — but requires RM 3.18M entry. M Arisa and Reizz Residence deliver RM 1,000+/month surplus at RM 270K-365K entry. The sweet spot for most investors is in that sub-RM500K bracket where LTV is high and absolute surplus exceeds RM 1,000/month. For more on that bracket, see our analysis of cashflow-positive areas under RM500K.

The KL risk: Higher entry price means more capital at risk per unit. A RM 630,000 median price requires RM 63,000 down at 90% LTV versus RM 47,500 for Johor. For investors buying multiple units, the capital efficiency difference matters. KL's depth partially mitigates this through faster exit liquidity if you need to sell.

Penang: Strong Demand, Tough for Foreigners

Penang's data is quickly stated: 16 cashflow-positive properties for Malaysian buyers. 12 for foreigners. The median surplus (RM 482 for Malaysians, RM 532 for foreigners) is competitive on a per-property basis — but the opportunity set is too small for most portfolio strategies.

Why Penang is constrained:

• Higher entry prices relative to rents. Penang's property market has experienced significant capital appreciation driven by owner-occupier demand and limited land supply on the island. Prices have risen faster than rents, compressing gross yields to a median 5.7% — the lowest of the three regions.
• The 3% state levy. Penang charges an additional 3% levy on foreign property purchases, stacking on top of the national 8% flat stamp duty. Total: 11%. On an RM 1M property, that is RM 110,000 in stamp duty alone — versus RM 80,000 in KL or Johor. That additional RM 30,000 upfront cost requires roughly 5 additional years of surplus to recover.
• Manufacturing sector dependency. Penang's rental demand comes heavily from the electronics and semiconductor manufacturing workforce — Bayan Lepas Free Industrial Zone, Intel, AMD, Micron. This creates strong demand in specific corridors but limited depth outside them. A downturn in the tech manufacturing cycle would hit Penang rental demand harder than KL's diversified tenant base.

Who should consider Penang: Malaysian investors with local knowledge of specific Penang developments where rental demand is proven and entry prices haven't fully reflected that demand. The 16 cashflow-positive properties that exist are concentrated in specific buildings — they require property-level analysis, not area-level strategy.

For Foreigners: Best Risk-Adjusted Return by Region

Foreign buyers face a fundamentally different cost structure: 8% flat stamp duty (11% in Penang), 70% maximum LTV, higher profit rates from most banks, and 30% withholding tax on rental income. The question is which region delivers the best risk-adjusted return under these constraints.

Johor: Highest Per-Unit Surplus, Concentrated Risk

Johor's 24 foreigner-eligible cashflow-positive properties generate a median surplus of RM 1,424/month — the highest of any region. But this number comes with a critical caveat: the median price is RM 1,975,000. These are not affordable units. They are predominantly high-end developments where large absolute rents overcome the foreign buyer cost disadvantage.

The concentration risk is real. 24 properties across an entire state means limited diversification. If you pick the wrong development, there is no second-best option at the same price point.

KL: Most Choice, Best Diversification

KL offers 257 foreigner-eligible cashflow-positive properties — more than 10x Johor. The median surplus is RM 1,341/month, slightly below Johor's RM 1,424 but backed by vastly more options. A foreign investor in KL can build a 3-4 unit portfolio of cashflow-positive properties. In Johor, you are effectively betting on a single development.

KL's deeper tenant pool also provides exit liquidity. If you need to sell, KL properties have more potential buyers — both local and foreign — than Johor equivalents.

Penang: Worst for Foreigners

12 cashflow-positive properties. RM 532/month median surplus — less than half of KL or Johor. The 11% total stamp duty (8% national + 3% Penang levy) is the single biggest drag. On a RM 1M property, Penang foreigners pay RM 30,000 more in stamp duty than they would in KL or Johor. That gap funds approximately 56 months of the RM 532 surplus — nearly 5 years just to recover the extra stamp duty cost.

Foreign investors should treat Penang as a special-situation market, not a core allocation.

Which Region Should You Pick?

The answer depends on your buyer profile, capital, and risk tolerance. Here is the decision framework:

Malaysian first-time buyer, limited capital (under RM500K): Johor. The RM 475K median entry price and 90% LTV mean approximately RM 47,500 down. Combine with the first-time buyer stamp duty exemption on properties up to RM500K for maximum capital efficiency. The RTS Link and JS-SEZ provide genuine structural upside — but buy for today's cashflow, not tomorrow's hope.

Malaysian investor seeking volume and reliability: KL. 456 cashflow-positive options, the highest median surplus, and the deepest tenant pool in Malaysia. If you are building a multi-unit rental portfolio, KL gives you the widest selection and the most reliable rental data to underwrite each deal.

Singaporean or foreign investor: KL for diversification (257 options), Johor if you want the highest per-unit return and are comfortable with concentration (24 options, RM 1,975K median entry). Avoid Penang unless you have specific local knowledge of a proven development — the 11% stamp duty makes the math nearly impossible.

Penang-specific play: Only if you know the exact development, have rental comparables you trust, and understand the manufacturing sector dynamics that drive tenant demand in your target area. This is not a market for area-level bets.

This Covers Three Regions. The Directory Covers Sixteen.

Johor, KL, and Penang are the three most popular investment regions — but they are not the only ones with cashflow-positive properties. The full PropCashflow Directory screens properties across 16 Malaysian regions, including Selangor (which has more sub-RM500K cashflow-positive properties than any other state), Melaka, Perak, and Sabah.

Every property in the directory includes the full 12-cost breakdown, confidence score, and both Malaysian and foreign buyer variants. No gross yield estimates. No agent projections. Just the net number that determines whether a property puts money in your account each month.

All figures based on listing and rental data as of April 2026. The 12-cost model uses prevailing rates (OPR 2.75%, conventional ~4.5%, Islamic ~4.0%) and standard assumptions (35-year tenure, 1 month vacancy). Actual results will vary by property, financing terms, and market conditions. This is not financial advice — consult a qualified property advisor and tax professional before making investment decisions.