Frequently Asked Questions

A maintenance fee is a regular payment collected from property owners in strata-titled developments, such as condominiums, serviced apartments, and gated communities, to cover the costs of managing and maintaining shared facilities and common areas like elevators, pools, security, and landscaping.

Non-payment can result in penalties, restricted access to facilities, or legal action.

This fund covers major repairs, renovations and upgrades to the common areas of the building. High-cost activities like repainting the building, purchase of movable assets for use as common properties, renewal or replacement of fixtures and fittings, as well as any other expenditure deemed necessary by the Joint Management Committee or Management Corporation, will be paid using the sinking fund.

In Malaysia, a Memorandum of Transfer (MOT) is a document that the buyer signs to transfer ownership from the seller to the buyer.

Signing the MOT means that the Land Title will be transferred from the developer or previous proprietors’ name to yours. Hence, it’s not issued if the property in question doesn’t have its Land Title yet.

In cases where the property to be bought had not received its relevant Land Title, a Deed of Assignment (DOA) form is used to transfer ownership of property, and a further document recording the Developers Consent will also be required.

RPGT is a tax on profit, it is one of the most important property-related taxes and is chargeable on the net profit gained from selling a property.

RPGT is taxed on a tiered basis between 5% – 30% depending on various factors such as how long the seller owned the property for before selling it off. Just as with stamp duty however, there are RPGT exemptions too!

A bridging loan is an effective financial tool for those needing immediate funding in property transactions or developments. However, its short-term nature and costs make it suitable for individuals or businesses with a clear repayment plan.

Conveyancing is the legal process of transferring ownership of property from one party (seller) to another (buyer). It ensures that all legal requirements are met during a property transaction to protect both parties' interests.

Conveyancer: Specializes in property law and handles residential property transactions.

Disbursements are additional costs incurred during a legal process, charged by solicitor or conveyancer, that are separate from their standard legal fees. These are payments made on your behalf to third parties as part of the property transaction process.

Disbursements are essential to the conveyancing process and ensure all necessary checks and registrations are completed.

(Local Authority Searches)

(Land Registry Fees)

(Stamp Duty)

(Bankruptcy Searches)

(Drainage and Water Searches)

(Environmental Searches)

(Telegraphic Transfer Fees)

A draft contract is a preliminary version of a legal agreement prepared during a property transaction. It outlines the terms and conditions agreed upon by the buyer and seller, serving as a foundation for finalizing the Sale and Purchase Agreement (SPA).

The draft contract is a crucial step in property transactions, ensuring transparency and agreement before proceeding with the final contract.

An interest rate is the percentage charged by a lender on a loan or paid by a bank on deposits over a specified period. It represents the cost of borrowing money or the reward for saving money. Interest rates are typically expressed annually as the Annual Percentage Rate (APR).

Fixed Interest Rate:

The rate remains constant throughout the loan or deposit term.

Floating/Variable Interest Rate:

The rate fluctuates based on market conditions or a benchmark, such as the Overnight Policy Rate (OPR) in Malaysia.

A joint mortgage is a home loan shared by two or more individuals who agree to jointly own the property and share the responsibility for repaying the loan. It is commonly used by couples, family members, or business partners who want to combine their incomes to qualify for a larger loan amount.

Loan Tenure usually aligned with the youngest borrower’s retirement age.

The mortgage loan tenure refers to the duration or period over which a borrower agrees to repay the mortgage loan. It is the length of time from the start of the loan until the final payment is made. The tenure can vary, with typical mortgage tenures ranging from 10 to 35 years, depending on the lender's policies and the borrower's financial situation.

The longer the loan tenure, the lower the monthly repayment. But the borrower will pay more interest.

A bank valuation is an assessment of the market value of a property conducted by a professional valuer on behalf of a bank or financial institution. It is typically required when applying for a mortgage loan to ensure that the property being used as collateral is worth the amount being borrowed. The bank uses this valuation to determine the loan-to-value (LTV) ratio and to ensure the property’s value supports the loan amount requested.

The valuation cost is usually a one-time fee and is separate from other transaction costs pay by the borrower, which may cost several hundred ringgit depending on the property’s value and location.

Fire insurance is a type of property insurance that provides coverage for damages to property caused by fire. It protects the policyholder’s property against damage or destruction due to fire, as well as related perils like smoke, explosions, and even water damage from firefighting efforts. Fire insurance can cover both residential and commercial properties. It offers coverage for both the physical structure of the property and personal belongings inside.

CTOS (Credit Tip-Off Service) is a leading credit reporting agency in Malaysia that provides credit information and reports to individuals and businesses. It helps assess the creditworthiness of individuals and companies by providing a detailed record of their financial behavior, including their credit history, payment habits, outstanding debts, and other financial obligations.

Financial institutions, such as banks, use CTOS reports to evaluate loan applications, approve or reject credit applications, and set interest rates based on the applicant's credit risk profile.

CCRIS stands for the Central Credit Reference Information System, which is a system operated by Bank Negara Malaysia (BNM), the country's central bank. It collects and stores information about individuals' and businesses' credit histories in Malaysia. The data is provided by financial institutions, including banks, to create a comprehensive record of a person's or business's borrowing and repayment behavior.

Information on loan types (personal loans, mortgage loans, personal loan, credit cards & PTPTN), loan amounts, and the payment status (paid on time, overdue, or defaulted) is included.

Mixed development refers to a type of real estate development that combines multiple types of land uses within the same project. Typically, these developments feature a blend of residential, commercial, and sometimes recreational or office spaces, all integrated into one location or building complex.

The aim of mixed development is to provide a self-contained environment, offering residents, workers, and visitors the convenience of having living, working, shopping, and leisure spaces in close proximity.

Fixtures are items that are permanently attached or fixed to the property. They are considered part of the building and are typically included in the sale unless otherwise specified.

Examples of Fixtures: Built-in wardrobes, Kitchen cabinets, Bathroom sinks, Plumbing fixtures (taps, shower heads), Windows and doors and etc.

Essentially, fixtures are items that cannot be easily removed without damaging the property.

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Fittings are items that are not permanently attached to the property and can be removed without causing damage. They are considered personal property and may or may not be included in the sale.

Examples of Fittings: Curtains and curtain rods, Freestanding furniture (e.g., couches, tables), Appliances (e.g., washing machines, refrigerators, ovens), Decorative items (e.g., mirrors, paintings), Flooring mats or carpets (if not fixed) and etc.

Fittings can be taken by the seller, depending on what has been agreed upon in the sale contract.

Advance rental is an upfront payment made by a tenant to the landlord at the beginning of a tenancy agreement. It is part of the rental arrangement and is typically applied toward the rent of the first month or a specific period during the lease.

Advance rental also serves as a confirmation of the tenant’s intent to rent the property and secures it for their use, preventing the landlord from offering it to other potential tenants.

Once paid, the advance rental is typically non-refundable unless the tenancy agreement specifies otherwise (e.g., a cancellation clause before moving in).

A security deposit is a sum of money paid by a tenant to a landlord at the start of a tenancy. In Malaysia, the security deposit is usually equivalent to 2 months' rent for residential properties. It acts as a financial safeguard for the landlord to cover any potential losses or damages caused by the tenant during their occupancy. The deposit is held by the landlord and is typically refundable at the end of the lease, provided the tenant meets the terms of the tenancy agreement.

If a tenant fails to pay rent, the landlord can use the security deposit to recover the outstanding amount.

When renting a property, the upfront cost typically includes several components. Here's a breakdown of the amount you should prepare:

1. Advance Rental - Usually equivalent to 1 month's rent
2. Security Deposit - Typically equivalent to 2 months’ rent
3. Utility Deposit - Generally equivalent to half a month’s rent
4. Tenancy Agreement Fee - RM250-RM350)
5. Stamp Duty - (Rental x 12months) - RM2,400 / 250
6. Agent Fee

*Actual fees may vary depending on the tenancy duration and legal arrangement.

In Malaysia, the stamp duty for the Memorandum of Transfer (MOT) is calculated based on the property’s purchase price or market value, whichever is higher. The rates are progressive, meaning they increase with the value of the property.

First RM100,000: 1%

Next RM400,000: 2%

Next RM500,000: 3%

Above RM1,000,000: 4%

Example Calculation (Property Price: RM750,000):

First RM100,000:

RM100,000 x 1% = RM1,000

Next RM400,000:

RM400,000 x 2% = RM8,000

Remaining RM250,000:

RM250,000 x 3% = RM7,500

RM1,000 + RM8,000 + RM7,500 = RM16,500

Freehold means you own the property and the land forever. Leasehold means you own it for a fixed term (usually 99 years) and the land belongs to the state government or a private entity.

Common costs include down payment (usually 10%), legal fees, stamp duty, valuation fees, loan agreement fees, and MOT (Memorandum of Transfer).

Return on Investment = (Annual Rental Income - Annual Costs) / Total Investment x 100%. A higher ROI means a better return.

Both quit rent and assessment are yearly payments you have to make to the government for owning a property — like a small "land tax" and "property service fee".

Quit Rent (Cukai Tanah):

• This is a land tax paid to the state government. It’s usually a small amount — maybe RM50 to RM200 a year, depending on your property size and location. It shows that you're using the land legally.

Assessment (Cukai Pintu):

• This is a fee paid to the local council (Majlis Perbandaran). It helps cover local services like garbage collection, road maintenance, and street lighting. It’s charged twice a year, based on your property's estimated rental value.

Both are compulsory and should be paid to avoid penalties.

Stamping is when your legal documents (Sales & Purchase Agreement (SPA), Loan Agreement or Tenancy Agreement) get an official stamp from the government (LHDN). This stamp proves the document is real, and it’s been registered with the government.

Without stamping, your document might not be accepted by the bank, court, or land office — and you could get into trouble later.

Short-term rental usually refers to daily or weekly stays — like Airbnb. It can generate higher income per night, but it requires more effort in terms of guest check-ins, cleaning, and management.

Long-term rental typically involves a fixed tenancy of 1 year or more. It offers more stable monthly income and is easier to manage, especially if you prefer a hands-off approach.

A bumi lot (short for Bumiputera lot) is a unit or land reserved specifically for Bumiputera buyers — which includes Malays and other indigenous groups in Malaysia. These units are usually offered at a discounted price, as part of the government’s policy to support Bumiputera ownership.