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PETALING JAYA (April 17): Malaysia's short-term rental sector is expected to expand over the next five years, driven by regulatory clarity, tourism recovery, and rising supply, though industry players warn that competition will intensify.
Malaysian Vacation Rental Services Management Association (MVR) president Ivan Chong said the outlook for Malaysia's short-term rental market over the next five years will depend largely on regulation, tourism, and supply dynamics.
"For short-term rentals, there are a few important factors that will determine whether they grow. Number one is definitely the regulation factor.
“If a regulation has been actually implemented, this is one factor that will definitely cause the market to grow — boom, so-called," he told EdgeProp during the Short-Term Rental Accommodation (STRA) Forum and Expo 2026 at Hextar World Exhibition Hall, Empire City here on Thursday.
Chong added that tourism growth and government initiatives will also support the sector.
"The second factor is the entire tourism market. With Visit Malaysia (VM) 2026, we also heard that the government is going to extend the tourism promotion year.
“Once the government is pushing the entire promotion of Malaysia, indirectly, STRA will also benefit," he said.
Chong added supply growth from new developments will continue to shape the market.
"The third factor is Malaysia's properties — the new condos, month to month, here and there, every single high-rise building is coming up. Which means supply increases.
“We also know that a lot of property purchases are actually investor-driven. At the end of the day, they're going to convert it into rental income — short-term rental. Which means, in each of these areas, you will see more and more supply in short-term rental coming in," he said.
Chong said while the market is expected to grow, rising supply will also intensify competition across the sector.
"It is considered quite balanced in terms of supply and demand. So definitely, in the next five years, I will see this industry grow.
“However, having said that, there are of course challenges — as in every single industry where supply increases, there will be a little bit of competition. This is also one of the potential threats or challenges," he said.
More travellers seeking non-urban destinations
Asia Travel Technology Industry Association (ATTIA) managing director Mark Chan said short-term rental trends are increasingly shaped by travellers moving beyond traditional urban destinations.
"What has been very interesting is travellers opting for secondary destinations, which are a little bit more alternative. Not just Kuala Lumpur and Penang — a lot of folks are very interested in going out to rural destinations, which offer different cultural experiences than cities," Chan said.
He added that domestic travellers account for a significant share of demand in non-urban listings.
"This is not only an international phenomenon — in fact, local travellers are making up the bulk of demand for these kinds of rural, non-urban destinations," noted Chan.
He said domestic travel is helping stabilise the sector amid global uncertainty.
"This is quite an important stabilising factor to make VM2026 a success," he added.
Chan said that travellers are increasingly opting for longer stays and localised experiences.
"We're definitely seeing all types of different shifts at the same time, which makes the diverse accommodation sector even more important.
“The broad trend over the years has been towards an increasing market for longer stays in local neighbourhoods where travellers can enjoy authentic experiences. That's certainly been a trend for quite some time," Chan said.
Focus on high-performing assets
Bukit Vista Bali founder Jing Cho Yang said operators should prioritise high-performing assets and exit underperforming units.
"If you're not getting a return on investment (ROI), it means those units aren't valuable. What you should do is let go of those units and allow competitors to take them," he said during his session on "Expanding Smart: Scaling to Large Portfolios with Practical Strategies".
"You should focus only on the units that deliver the highest ROI," Jing said.
He said portfolio performance improved after restructuring partnerships and scaling down.
"When we scaled down, everything started improving. Our assets under management increased. We removed owners who weren't aligned with the goal of actually generating returns from their properties.
“We also removed owners who didn't have long-term commitment with us and were constantly overcomplicating or disrupting our operations," Jing said.
STRA 2026 is Malaysia's inaugural industry event dedicated to the STRA sector, bringing together operators, hosts, developers, agents and solution providers for discussions, networking and knowledge-sharing on regulation, market trends and operational best practices.
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