Property Prices Are Rising — But Is the Market Actually Getting Stronger?

A higher property price can look like good news. But price alone does not tell you how active the market is. Learn how median price, transaction count and PSF can give buyers and investors a more complete picture before making a decision.

Imagine you are watching a neighbourhood where the median transaction price moves from RM500,000 to RM550,000.

At first glance, that sounds positive.

Prices are higher, so perhaps demand is stronger and owners are doing well.

Now add one more piece of information.

During the earlier period, 80 transactions were recorded. During the later period, only 20 were recorded.

The median price increased by 10%, while the number of transactions fell by 75%.

Does that mean the market is weak? Not necessarily. Does the higher median prove that the market is stronger? Not necessarily either.

It simply shows why one number rarely tells the whole property story.

Start with what median price actually tells you

Median price is the middle transaction value after the transactions in a dataset are arranged from lowest to highest.

For example, imagine five transactions:

• RM400,000
• RM430,000
• RM450,000
• RM480,000
• RM900,000

The median price is RM450,000.

The RM900,000 transaction does not pull the median upwards in the same way it would affect an average.

That makes median price useful when you want a benchmark for what properties within a particular dataset have actually transacted for.

But a median has an important limitation. It tells you about the transactions that happened.

It does not tell you how many properties failed to sell, how many owners were trying to sell, how long properties stayed on the market or whether buyers became more or less willing to transact.

That is why transaction count should be read alongside price.

A higher price with fewer transactions tells a different story

Return to the hypothetical example:

Earlier period

• Median price: RM500,000
• Transactions: 80

Later period

• Median price: RM550,000
• Transactions: 20

The later transactions took place at a higher median price. That is factual. But far fewer transactions occurred. That is also factual.

What you should avoid doing is immediately turning those two numbers into a conclusion such as:

The market is booming.

or:

The market is collapsing.

There are many possible explanations for a change in transaction count. The mix of properties transacted may have changed. Owners may have been less willing to sell. Buyers may have become more selective. Financing conditions may have changed. There may also simply have been fewer suitable properties available.

The numbers tell you where to investigate next. They do not automatically tell you why the change happened.

Why transaction count matters to a buyer

Suppose you are considering a home listed at RM650,000. You check recent transactions and find that the latest median price for similar properties is also around RM650,000. That is useful context.

But your next question should be:

How many relevant transactions support that benchmark?

A median calculated from hundreds of closely comparable transactions gives you a different type of market context from a median based on only a handful of transactions.

Neither figure is automatically right or wrong. The size of the sample simply affects how you should interpret it.

This becomes particularly important in property types or locations where transactions are infrequent. If only a few properties have changed hands, one median number should not be treated as a precise valuation for every property nearby.

Why transaction count matters to a seller

Sellers can make the same mistake in the opposite direction. Imagine the latest median price in your area is RM700,000.

It may be tempting to think:

Properties here are worth RM700,000 now.

But the median does not tell you how many buyers are prepared to purchase your particular property at that price.

Your unit may differ in:

• Size
• Condition
• Floor or position
• Land area
• Tenure
• Renovation
• Parking
• Exact location
• Property type

The median is a useful starting point. It is not an automatic selling price.

For a seller, transaction volume also provides context about how much recorded activity exists within the market segment you are comparing.

Price per square foot can reveal another layer

Total price alone can also create misleading comparisons.

Imagine two properties. Property A transacts at RM800,000. Property B transacts at RM600,000. Property B has the lower total price.

But that does not automatically mean Property B is cheaper on a comparable basis. If Property A provides substantially more land or built-up area, its price per square foot could be lower.

This is why PropMedian looks at both median price and median PSF where the underlying transaction data supports the calculation.

Median price helps you understand the middle transaction value within the selected dataset. Median PSF helps you compare price relative to area.

Neither metric should be interpreted without checking what type of properties are included.

Property mix can move the median too

Another reason to be careful with headline price changes is that the properties transacted during two periods may not be identical.

Suppose more large units transact during one period. The median total price could rise even if the underlying market did not experience the same increase across every unit type.

The reverse can also happen if a later dataset contains more smaller or lower-priced properties.

This is why good property analysis should narrow the comparison as much as practical.

• District and mukim
• Scheme or development
• Property type
• Size
• Transaction period
• Tenure
• Relevant transaction count

The more comparable the properties are, the more useful the benchmark becomes.

Four combinations worth investigating

Price and transaction count can move in different directions. None of the combinations below should automatically be labelled good or bad.

Price rises and transaction count rises

More transactions are recorded while the median also moves higher. That is worth investigating further. Ask whether the property mix remained comparable and whether the increase appears across similar properties.

Price rises and transaction count falls

The transactions that occurred recorded a higher median, but fewer transactions took place. This is exactly where looking only at the headline price can create an incomplete picture.

Price falls and transaction count rises

More transactions occurred at a lower median price. Again, property mix and the type of transactions involved matter before interpreting the change.

Price falls and transaction count falls

Both the median and recorded transaction count are lower. That may attract attention, but the data still does not tell you the cause without additional investigation.

Use property data as a benchmark, not a prediction

Transaction data is especially useful for answering practical questions such as:

• What have similar properties actually transacted for?
• What is the median price within this dataset?
• What is the median PSF?
• How many transactions support the figures?
• Does the asking price appear unusual compared with relevant recorded transactions?

Those are useful questions when preparing for a viewing, negotiation or pricing discussion.

What historical transaction data cannot guarantee is the price at which a particular property will transact next. It also cannot tell you whether a property will appreciate in future.

Use the data to improve the quality of your questions rather than to create false certainty.

Before buying, look beyond the headline price

When a property headline says prices are rising, ask what sits underneath that statement.

• Check the transaction period
• Check the number of transactions
• Check the property type
• Check PSF where appropriate
• Check whether you are comparing genuinely similar properties

A higher median can be important information. So can a lower median. But the real value comes from understanding the dataset behind the number.

For your own property search, use PropMedian Property Search to explore available recorded transactions and compare median price, PSF and transaction samples across relevant Malaysian property markets.

Transaction records provide historical market context. They do not constitute a valuation, investment recommendation or prediction of future property performance.

Source note: The RM500,000 to RM550,000 price example and the 80-to-20 transaction example in this article are hypothetical illustrations designed to explain how median price and transaction count can produce different signals. They are not presented as transaction statistics for a specific Malaysian property market.

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