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This guide provides information on what foreign nationals should be aware of when renting property in Malaysia in order to avoid scams and other legal issues. It also provides information on commercial practices and other relevant information regarding rental of property in Malaysia. Last updated in June 2023.
General
What are the common types of rental properties available in Malaysia?
The common types of rental properties in Malaysia are residential properties (apartments, condominiums and landed properties), commercial properties, industrial properties and agriculture land.
Is it common for rental properties in Malaysia to be furnished or unfurnished?
Both furnished and unfurnished properties are available in Malaysia, but furnished properties are rented at higher rate.
What are the requirements for a foreign tenant to rent a property in Malaysia?
Foreign tenants are required to have a valid passport and visa, and may need to provide proof of employment or financial stability if requested by the landlord.
Are there any specific laws or regulations that a foreign tenant should be aware of when renting a property in Malaysia?
Yes, foreign tenants should be aware of the laws related to tenancy are stated in a number of legislations: Contracts Act 1950 (covering conflicts on the tenancy agreement), Civil Law Act 1956 (covering payment disputes), Distress Act 1951 (covering matters of eviction), Specific Relief Act 1950 (prohibits landlords from evicting tenants or making the property inaccessible to tenants without a court order). By mid-2023, the new Malaysian Residential Tenancy Act will come into force, which outlines the rights and responsibilities of tenants and landlords.
Does the rental agreement need to be in writing?
It is advisable for a rental agreement to be in writing, and it should clearly outline the terms and conditions of the rental, including the rental amount, duration of the rental, and security deposit.
What is the typical duration of a rental agreement in Malaysia?
The typical duration of a rental agreement in Malaysia is more between 1 to 3 years, with the option to renew.
What is the process for paying rent in Malaysia?
Rent is typically paid on a monthly basis and can be paid via bank transfer or in cash.
What should a foreign tenant do if they have a dispute with their landlord in Malaysia?
If a dispute arises, the tenant should first try to resolve the issue through communication with the landlord. If this is not possible, the tenant can seek the assistance of the lawyer, police, property management company or Malaysian Housing and Local Government Ministry, whichever applicable.
What can I do to minimize the occurrence of dispute with landlord?
You are advised to: (a) conduct due diligence on the property yourself or through legal representative; and (b) have a legal representative to vet the terms and conditions of booking before entering into any form of agreement, including signing on a booking form.
Before Renting
What do I need to do before paying a booking fee for a tenancy in Malaysia?
You are advised to engage an independent legal representative to conduct a due diligence to verify or discover the legal ownership, restrictions or encumbrances on land. Apart from due diligence, it is also important to seek for assistance from an independent legal representative to ensure that the terms and conditions contained in the booking form are legal, reasonable, fair and in line with the common practice.
What is due diligence on property?
Property due diligence is the process of thoroughly reviewing and verifying all relevant information about a property before entering into a tenancy agreement. This includes conducting official land search, confirmation on the identity of the legal owner, and identifying restrictions and encumbrances on the land. Read more here on due diligence.
What are the benefits of having a legal representative before booking a tenancy in Malaysia?
A lawyer has the expertise to thoroughly review all legal documents related to the property, ensuring that there are no issues with the title or ownership. They can also provide advice on the terms of the tenancy and assist with negotiating any necessary changes. Furthermore, a lawyer can help ensure that the booking form is negotiated fairly and drafted in compliance with laws, and in line with common trade practice. Read more here on our vetting service for tenancy booking form.
Tenancy Agreement
What should I look out for when reviewing a tenancy agreement in Malaysia?
When reviewing a tenancy agreement, a foreign tenant should look out for the terms and conditions regarding the rental amount, the duration of the rental, payment terms, security deposit, utilities, and any restrictions or obligations imposed on the tenant. The tenant should also ensure that the agreement complies with Malaysian law and regulations.
Is it possible to make changes to the tenancy agreement in Malaysia?
Yes, it is possible to make changes to the tenancy agreement by mutual consent in writing, but it is advisable to do so through legal representation to ensure that the changes are legally binding.
What happens if I need to terminate the tenancy agreement in Malaysia before expiration of the tenancy term?
If you need to terminate the tenancy agreement, you should first consult the agreement to see if there are any provisions that govern early termination. If there are, you should follow the provisions outlined in the agreement. If there are no provisions, you may need to compensate in accordance with the terms of the tenancy and provide termination notice to the landlord. Most likely you will lose your security deposit for breaching the agreement.
What is the security deposit for a rental property in Malaysia?
The security deposit is a sum of money paid by the tenant at the start of the tenancy agreement to cover any damages or unpaid rent. The amount of the security deposit is usually a multiply of the monthly rent.
When will the security deposit be returned to the tenant after the tenancy agreement ends in Malaysia?
The security deposit will be returned to the tenant after the tenancy agreement ends, subject to the terms of the agreement and after the property has been inspected and any damages have been assessed and deducted from the deposit.
Conclusion
In conclusion, renting a property in Malaysia as a foreign tenant requires careful consideration and preparation. It is important to conduct due diligence, review the terms and conditions of the tenancy agreement, and seek legal assistance if possible. Contact our firm here to ensure a smooth and safe rental experience in Malaysia.
