REAL ESTATE FAQ

Answers To Your Key Property Questions

A comprehensive guide covering property sales, purchases, bank loan eligibility, legal fees, stamp duty, and Real Estate Negotiator (REN) services in Malaysia.

Agency Fees
1. What is the standard agent commission rate for property sales in Malaysia?
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According to LPPEH guidelines, the maximum agency fee for residential property transactions is capped at 3% of the agreed transacted price.

This fee is paid by the property seller upon successful execution of the Sales and Purchase Agreement (SPA) and settlement of the 10% deposit.

Homebuyers
2. How much upfront cash do I need to purchase a residential home?
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For subsale property purchases, buyers typically require:

  • 10% Cash Deposit: Consisting of 3.24% earnest deposit upon signing the Offer to Purchase (OTP), and 6.76% balance deposit upon signing the SPA.
  • 3% - 5% Additional Cash: Covering SPA & Loan legal fees, bank valuation fee, and MOT Stamp Duty.

Note: First-time homebuyers enjoy 100% MOT stamp duty exemption on properties priced up to RM500,000.

Land Tenure
3. What is the main difference between Freehold and Leasehold property?
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Freehold: Grants perpetual land ownership with no expiration. Subsale transfers for non-Bumi buyers do not require State Consent, resulting in faster transactions (~3 months).

Leasehold: Land is leased from the State Government (typically for 99 years). Each transfer requires State Consent approval (2-6 months). However, Leasehold properties are usually 15%-20% cheaper and offer higher rental yields.

Bank Financing
4. How do Malaysian banks calculate my Debt Service Ratio (DSR)?
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Banks determine home loan eligibility using the Debt Service Ratio (DSR):

DSR = (Total Monthly Debt Commitments / Net Income After Tax & EPF) x 100%

The maximum DSR limit for most local banks ranges between 60% and 70%. For example, with a net salary of RM5,000 and existing debts of RM1,500, your maximum eligible monthly housing instalment is around RM1,500 - RM2,000.

Loan Application
5. What essential documents are required for a bank loan application?
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For Salaried Employees (Private / Government Sector):

  • Copy of NRIC (Front & Back).
  • 3 - 6 Months Latest Pay Slips.
  • 3 - 6 Months Latest Bank Statements.
  • Latest EPF Statement.
  • Latest EA / BE LHDN Income Tax Form.

For Self-Employed / Business Owners: Provide SSM Registration, 6 Months Company Bank Statements, LHDN Form B, and Audited Accounts.

Legal Requirements
6. Can a buyer and seller share the same law firm in a transaction?
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Under the Legal Profession Act 1976 in Malaysia, a single law firm CANNOT represent both buyer and seller in the same property transaction to prevent conflict of interest.

The law firm typically represents the buyer for SPA and loan documentation, while the seller may appoint their own lawyer or be unrepresented for discharge of charge purposes.

REN Role
7. What services does Registered Real Estate Negotiator Zaim Rosli (REN39575) provide?
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As a registered REN under LPPEH with a licensed agency, Zaim Rosli provides comprehensive end-to-end services including:

  • Free Market Valuation Checks (Bank Valuation).
  • Buyer Pre-Qualification & DSR Screening before booking fee payment.
  • Aggressively marketing properties via major portals & digital channels.
  • Managing Offer to Purchase (OTP) documentation, panel lawyers, and top banker connections.
Transaction Timeline
8. How long does the entire subsale transfer process take until key handover?
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Freehold Property: Average transaction timeline is 3 months from bank loan approval and SPA execution.

Leasehold Property: Average timeline is 4 to 6 months, as it requires State Consent application approval before the official 3-month completion clock starts.

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