New Home Costs in Malaysia: Stamp Duty & Legal Fees
Pasukan RumahHQ · Published 24 September 2026 · Updated 24 September 2026 · 12 min read
In brief
- On top of the price come legal fees, stamp duty, disbursements, insurance, utility deposits and taxes; some are paid once, some every year.
- For developer homes, SRO 2023 Table B sets legal fees lower than Table A; legal services carry 8% service tax.
- The first-home stamp-duty exemption covers homes valued at no more than RM500,000. A home above that does not qualify at all, not even in part.
The price in the advertisement is not the amount you need to prepare. On top of the price come legal fees, stamp duty, disbursements, insurance, utility deposits and taxes. Some are paid once; some recur every year. Buyers who have not set money aside for these often have to borrow again at the last minute.
This guide lists every cost of buying a new home from a developer in Peninsular Malaysia, who bears it under the standard agreement, when it is paid, and two full worked examples.
General information only, not legal, financial or tax advice. All amounts in the examples are hypothetical and estimates only. Ask your lawyer and bank for written quotations.
Terms used
- SPA (sale and purchase agreement): the contract between you and the developer. For a landed home from a licensed developer, the SPA uses the standard Schedule G form under the Housing Development (Control and Licensing) Act 1966 [Act 118], or HDA. For strata homes (condominiums, apartments), the form is Schedule H.
- Loan agreement: the contract between you and the bank (or LPPSA) for the financing.
- MOT (memorandum of transfer): the document that transfers the land title into your name.
- Disbursements: payments your lawyer makes on your behalf, such as land searches, bankruptcy searches, registration of the charge and caveats.
- VP (vacant possession): the date the keys are handed over.
- SRO 2023: the Solicitors’ Remuneration Order 2023, which sets the scale of legal fees. It took effect on 15 July 2023 and replaced the 2005 order.
- Before the SPACheck financing eligibility and work out the full cost
- Signing the SPAFirst payment, SPA legal fees and stamp duty on the SPA
- Loan documentsLoan legal fees, loan stamp duty, disbursements, insurance if chosen
- During constructionThe bank pays the developer by construction stage
- Vacant possession (VP)Utility deposits, service-cost contribution and home insurance; taxes start
- Transfer and afterStamp duty on the transfer and registration; then the defect liability period and yearly costs
The full list of costs and who bears them
| Cost | Basis | Who bears it | When |
|---|---|---|---|
| First payment of the price | 10% of the price (Third Schedule, Schedule G) | Buyer | On signing the SPA |
| SPA legal fees (your lawyer) | SRO 2023, First Schedule, Table B, plus 8% service tax | Each party bears its own lawyer (clause 30(1)); developers sometimes pay as a promotion | Around signing the SPA |
| Stamp duty and registration fee on the SPA and the transfer | Stamp Act 1949; transfer tiered 1% to 4% | Buyer (clause 30(2)) | SPA: after signing. MOT: when title is transferred |
| Cost of State Authority consent to transfer (if any) | - | Developer (clause 30(3)) | - |
| Loan agreement legal fees | SRO 2023, Third Schedule, Table B, plus 8% service tax | Buyer | Within 30 days of obtaining the financing (clause 6(1)) |
| Stamp duty on the loan agreement | 0.5% of the loan amount | Buyer | When the loan documents are executed |
| Disbursements | At actual cost | Buyer | During the SPA and loan work |
| Valuation fee | As the bank requires; for example BSN charges it for completed properties only | Buyer, if required | During the loan application |
| MRTA / MRTT | Varies with age, tenure and loan amount | Buyer, if chosen | When the loan is executed |
| Fire / houseowner insurance | As the bank and insurer require | Buyer, if required | Usually around VP, then yearly |
| Water and electricity meter deposits | As the utility requires | Buyer (clause 21(2)); the developer bears other connection costs | Within 30 days of the developer's notice |
| Contribution to service costs (before the local authority takes over) | A fair and justifiable share | Buyer (clause 20) | First 6 months paid in advance at VP |
| Quit rent and assessment | State and local authority rates | Buyer (clause 19) | From VP or transfer, whichever is earlier |
| Maintenance charges and sinking fund (strata only) | Sinking fund = 10% of the charges (Act 757, s.12) | Buyer | Periodically, after VP |
1. Legal fees: the SPA and the loan agreement
The base scale (Table A)
SRO 2023 sets the same scale for transfers (First Schedule) and financing documents (Third Schedule):
| Price or loan amount | Scale fee |
|---|---|
| First RM500,000 | 1.25% (minimum RM500) |
| Next RM7,000,000 | 1% |
| Above RM7,500,000 | Negotiable, not more than 1% of the excess |
The discount for developer homes (Table B)
For transactions governed by the HDA, that is an SPA with a licensed developer and its financing, SRO 2023 sets Table B, which is lower than Table A:
| Price or loan amount | Fee |
|---|---|
| RM50,000 or less | RM500 |
| Above RM50,000 to RM250,000 | 75% of the Table A fee (minimum RM500) |
| Above RM250,000 to RM500,000 | 70% of the Table A fee |
| Above RM500,000 to RM1,000,000 | 65% of the Table A fee |
| Above RM1,000,000 | 50% of the Table A fee |
The percentage applies to the whole Table A fee. For example, for a RM300,000 developer home the Table A fee is RM3,750, and 70% of it is RM2,625, as in the example published by the National House Buyers Association (HBA) in EdgeProp.
Service tax: legal services carry 8% service tax from 1 March 2024 (Malaysian Bar Circular No. 078/2024).
Additional loan documents: if the bank needs additional security documents (subsidiary instruments), the fee for each is 10% of the full scale fee, minimum RM500 and maximum RM2,000.
Who pays the SPA legal fees?
Clause 30(1) of Schedule G: each party bears its own solicitors’ costs. So you pay your lawyer and the developer pays its lawyer. As a promotion, some developers offer to pay the buyer’s SPA legal fees. This varies by project and is not guaranteed. If it is offered, make sure it is in writing and ask whether it covers disbursements and service tax.
2. Stamp duty
On the instrument of transfer (MOT)
Duty is charged on the consideration (price) or the market value, whichever is higher, in tiers (item 32(a), First Schedule, Stamp Act 1949). The buyer bears it.
| Portion of value | Rate |
|---|---|
| First RM100,000 | 1% |
| Above RM100,000 to RM500,000 | 2% |
| Above RM500,000 to RM1,000,000 | 3% |
| Above RM1,000,000 | 4% |
On the loan agreement
For an ordinary secured loan, duty is 0.5% of the loan amount.
The first-home exemption
Malaysian first-time buyers are fully exempt from stamp duty on the instrument of transfer and the loan agreement for one residential unit valued at no more than RM500,000, where the sale and purchase agreement is signed from 1 January 2021 to 31 December 2027 [P.U.(A) 53/2021 and P.U.(A) 54/2021, as amended by P.U.(A) 448/2025 and P.U.(A) 449/2025]. You must never have owned a residential property, including by inheritance or gift, alone or jointly. A home valued above RM500,000 does not qualify at all, not even in part. See our first-home incentives guide.
3. Loan and insurance costs
- Disbursements: the BSN MyHome Product Disclosure Sheet lists, among others, stamping fees, registration of the charge, registration of security documents, lodgement and withdrawal of caveats, bankruptcy searches and official land searches. Ask for a written estimate.
- Valuation fee: a formal valuation report by a registered valuer. Some banks, BSN for example, charge it for completed properties only.
- MRTA / MRTT: Mortgage Reducing Term Assurance (conventional) or Takaful (Islamic), cover that pays off the loan balance if the borrower dies or is permanently disabled. BSN describes it as optional. The premium can be paid in cash or financed with the loan, which increases the debt.
- Fire / houseowner insurance: the bank may require it for a mortgaged home. Check your offer letter.
If you use SJKP, the SJKP scheme’s financing limit (up to RM500,000) includes the principal, MRTA/MRTT, LTHO, legal fees and valuation fees, according to SJKP’s website. This helps buyers who do not have the cash for these costs.
4. Costs at and after key handover
- Water and electricity meter deposits: clause 21(2) of Schedule G, the buyer pays the meter installation deposits within 30 days of the developer’s notice; the developer bears the other costs of connecting supply.
- Contribution to service costs: until services are taken over by the local authority, the buyer contributes a fair share. Clause 20(2): the first 6 months are paid in advance on the VP date, then monthly. The balance is refunded within 30 days of the local authority taking over.
- Quit rent (cukai tanah): an annual tax paid to the state Land Office.
- Assessment (cukai pintu or cukai taksiran): a tax paid to the local authority under the Local Government Act 1976 [Act 171]. For example, Subang Jaya City Council calculates it as the annual value multiplied by a percentage rate.
- When the taxes start: clause 19 of Schedule G, from the VP date or the transfer date, whichever is earlier. If the title has not been transferred at VP, you reimburse the developer in proportion to your lot’s area.
- Strata homes only: maintenance charges and sinking fund contributions are paid to the developer during the developer’s management period. Section 12(4) of the Strata Management Act 2013 [Act 757] sets the sinking fund contribution at 10% of the charges.
Full worked examples
Two hypothetical examples, both landed homes from a licensed developer with a Schedule G SPA and a 90% loan. Figures are rounded to the nearest sen. Disbursements, insurance, utility deposits and taxes are left out because they depend on the lawyer, bank, utility and local authority.
| Item | Example A: RM350,000, first-time buyer | Example B: RM550,000 |
|---|---|---|
| Loan amount (90%) | RM315,000 | RM495,000 |
| First 10% payment at SPA | RM35,000.00 | RM55,000.00 |
| SPA legal fees (Table B) | RM4,375 × 70% = RM3,062.50 | RM6,750 × 65% = RM4,387.50 |
| 8% service tax on SPA fees | RM245.00 | RM351.00 |
| Loan legal fees (Table B) | RM3,937.50 × 70% = RM2,756.25 | RM6,187.50 × 70% = RM4,331.25 |
| 8% service tax on loan fees | RM220.50 | RM346.50 |
| Stamp duty on transfer | RM6,000 calculated, RM0 after the first-home exemption | RM1,000 + RM8,000 + RM1,500 = RM10,500.00 (not eligible for exemption) |
| Stamp duty on loan agreement (0.5%) | RM1,575 calculated, RM0 after the first-home exemption | RM2,475.00 (not eligible for exemption) |
| Total known upfront costs | RM41,284.25 | RM77,391.25 |
| If the developer pays the SPA legal fees (promotion) | RM3,307.50 less | RM4,738.50 less |
Two hypothetical examples: how the figures are worked out for a home that qualifies for the exemption, and for one above the limit (estimate only)
Example A: how the figures are worked out
Table A fee for a RM350,000 price: 1.25% × RM350,000 = RM4,375. The price is in the above-RM250,000-to-RM500,000 band, so the Table B fee is 70%, or RM3,062.50. Loan of RM315,000: 1.25% × RM315,000 = RM3,937.50, and 70% of that is RM2,756.25.
Without the exemption, transfer duty would be RM1,000 (1% on the first RM100,000) + RM5,000 (2% on the next RM250,000) = RM6,000, and loan duty RM1,575. An eligible first-time buyer saves this RM7,575.
Example B: why the cost is so much higher
The RM550,000 price is above the RM500,000 limit, so there is no stamp-duty exemption at all, even if the buyer has never owned a home. Table A fee for the SPA: RM6,250 (1.25% on RM500,000) + RM500 (1% on RM50,000) = RM6,750, and 65% of that is RM4,387.50. The RM495,000 loan is in the RM250,000-to-RM500,000 band, so 70% of RM6,187.50, or RM4,331.25.
The RM200,000 price difference between A and B adds roughly RM36,000 to the upfront costs.
When each cost is paid
- Before the SPA Check your financing eligibility and work out the full cost. Registering interest in a project that has not launched needs no payment.
- Signing the SPA First payment of 10% of the price. Your lawyer's SPA legal fees (unless the developer pays them). Stamp duty on the SPA.
- Loan documents (within 30 days of obtaining the financing) Loan legal fees, 0.5% loan stamp duty (unless exempt), disbursements, a valuation fee if required, MRTA or MRTT if chosen.
- During construction The bank pays the developer by stage under the Third Schedule. Ask your bank when your instalments start and how they are calculated during construction.
- Vacant possession (VP) Water and electricity meter deposits, 6 months of service-cost contribution in advance, home insurance if required. Quit rent and assessment start.
- Transfer of title Stamp duty on the transfer (unless exempt) and the registration fee.
- After VP A 24-month defect liability period. Quit rent and assessment every year; maintenance charges and sinking fund for strata.
Common mistakes
- Saving only for the 10% first payment. In Example B, fees and duties add more than RM22,000 on top.
- Assuming “free legal fees” covers everything. Ask whether it includes loan fees, disbursements and service tax.
- Counting on the stamp-duty exemption for a home above RM500,000. That home does not qualify at all.
- Forgetting recurring costs. Quit rent, assessment, insurance and strata charges are paid every year or every month.
- Financing every cost with the loan without looking at the total interest. Financed MRTA adds to the loan principal and the interest.
Checklist: what to prepare
Next step
Work out how much you can borrow with our eligibility calculator (estimate only), and read the first-home financing guide and how to check your eligibility before buying a first home. If you are a civil servant, see how to apply for LPPSA for a developer home. When you are ready, register your interest in RumahHQ Development Sdn Bhd projects. It is free, non-binding and involves no payment.
Questions
How much are the SPA legal fees for a home bought from a developer?
Under the Solicitors' Remuneration Order 2023, transactions under the Housing Development Act use Table B: a percentage of the Table A fee (1.25% on the first RM500,000, 1% on the next RM7 million). For example, 70% for prices above RM250,000 up to RM500,000. Service tax of 8% applies to legal fees.
Must the developer pay my SPA legal fees?
No. Clause 30(1) of Schedule G says each party bears its own solicitors' costs. Some developers pay the buyer's SPA legal fees as a promotion, but it varies by project and is not guaranteed. Make sure the offer is in writing.
Do first-time buyers pay stamp duty?
Citizens who have never owned a residential property are fully exempt from stamp duty on the instrument of transfer and the loan agreement for one home valued at no more than RM500,000, if the SPA is signed from 1 January 2021 to 31 December 2027.
When do I start paying quit rent and assessment?
Under clause 19 of Schedule G, the buyer is liable for quit rent, assessment and other outgoings from the date of vacant possession or the date the property is transferred to the buyer, whichever is earlier.
Is MRTA compulsory?
Not necessarily. For example, the BSN MyHome Product Disclosure Sheet describes MRTA as optional. Insurance conditions differ by bank; check your offer letter.
Sources
(12)
- Malaysian Bar, Circular No 258/2023: Solicitors' Remuneration Order 2023 — read 2026-09-24
- EdgeProp (Chang Kim Loong, HBA), Increase in legal fees will, however, be set off by (legal) discounts — read 2026-09-24
- Malaysian Bar, Circular No 078/2024: Increase in rate of service tax from 6% to 8% — read 2026-09-24
- LHDN, Guideline on stamp duty for instruments under the First Schedule, Stamp Act 1949 — read 2026-09-24
- Edwin Lee & Partners, A Guide to Stamp Duty on Loan Agreements in Malaysia — read 2026-09-24
- Malaysian Bar, Circular No 128/2026 (P.U.(A) 448/2025 and 449/2025) — read 2026-09-24
- Act 118, Regulations 1989, Schedule G (copy hosted by REHDA Melaka) — read 2026-09-24
- Strata Management Act 2013 [Act 757] (copy) — read 2026-09-24
- BSN, Product Disclosure Sheet, BSN MyHome Skim Rumah Pertamaku — read 2026-09-24
- SJKP, Housing Credit Guarantee Scheme: scheme information — read 2026-09-24
- Subang Jaya City Council, Assessment Tax (Cukai Taksiran) — read 2026-09-24
- Selangor Land and Mines Office, Quit rent payment — read 2026-09-24
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