The short answer
The SPA, or sale and purchase agreement, is the contract you sign to buy a home. It sets the price, how and when you pay, when you get the keys, and what happens if either side does not do its part.
For a new home bought from a licensed developer in Peninsular Malaysia, you do not negotiate most of it. The law fixes a standard form: Schedule G for a landed house and Schedule H for a unit in a strata building, such as a condominium or apartment. These forms set:
- A payment schedule tied to construction stages.
- A deadline to hand over the home: 36 months for Schedule H, 24 months for Schedule G, from the date of the SPA.
- Damages for late delivery at 10% a year of the price, counted day by day.
- A defect liability period: 24 months after you take vacant possession in the Schedule H form.
On a RM 500,000 condominium with a 90% loan, the SPA asks for 10%, RM 50,000, on signing, usually including the booking fee, with the rest paid in stages. To see the loan side in numbers, use the loan calculator.
What the SPA is, in plain words
Before the SPA you usually sign a booking form and pay a booking fee. The booking form shows you want the unit. The SPA is the real contract that binds both sides.
The SPA covers, among other things:
- The parties and the property: who is buying, who is selling, the unit, its size and the land it sits on.
- The price and how you pay it.
- When the home is handed over, and what the seller owes you if it is late.
- Your rights after handover, such as the defect liability period.
- What each side pays, such as legal fees and stamp duty.
- What happens if someone does not perform, such as late payment by you or failure to deliver by the developer.
After the SPA, your bank and lawyers prepare the loan documents and, later, the transfer. See the MOT guide for the transfer step.
Developer SPA vs subsale SPA
| Point | Buying from a developer (new home) | Buying from an owner (subsale) |
|---|---|---|
| Form | Standard Schedule G or H, set by law | Drafted by lawyers, terms agreed between the parties |
| Payment | 10% on signing, the rest in construction stages | Usually a deposit on signing, the balance by a completion date |
| Handover deadline | 24 months (G) or 36 months (H) from the SPA | Agreed in the SPA |
| Late delivery | Damages at 10% a year of the price | As agreed in the SPA |
| Defect liability | 24 months after VP in the Schedule H form | Usually none from the seller; you buy as it is |
The rest of this page is about the developer SPA under Schedule H, since most new homes in Kuala Lumpur and the Klang Valley are strata units.
The Schedule H payment schedule
The Third Schedule of the Schedule H form sets how the price is paid. Each stage is due within 30 days of the developer's written notice that the stage is complete, supported by a certificate from the developer's architect or engineer.
| Stage | Share of price | On RM 500,000 |
|---|---|---|
| 1. On signing the SPA | 10% | RM 50,000 |
| 2(a) Work below ground level, including foundation | 10% | RM 50,000 |
| 2(b) Structural framework of the unit | 15% | RM 75,000 |
| 2(c) Walls with door and window frames | 10% | RM 50,000 |
| 2(d) Roofing or ceiling, wiring, plumbing, gas piping and telecom trunking | 10% | RM 50,000 |
| 2(e) Internal and external finishes | 10% | RM 50,000 |
| 2(f) Sewerage works | 5% | RM 25,000 |
| 2(g) Drains | 2.5% | RM 12,500 |
| 2(h) Roads | 2.5% | RM 12,500 |
| 3. On vacant possession, with water and electricity ready for connection | 17.5% | RM 87,500 |
| 4. On vacant possession, when the transfer and strata title are handed over | 2.5% | RM 12,500 |
| 5. On vacant possession, held by the developer's solicitors as stakeholder | 5% | RM 25,000 |
| Total | 100% | RM 500,000 |
The last 5% is held by the developer's solicitors: 2.5% is released 8 months after you take vacant possession and 2.5% after 24 months. It gives the developer a reason to repair defects you report.
Worked example: a RM 500,000 condominium
Same assumptions as the DSR guide: a RM 500,000 home, a 90% loan of RM 450,000, 30 years, an assumed 4.2% a year. The rate is for illustration only.
Your own money. The first 10%, RM 50,000, comes from you. Any booking fee already paid is normally counted towards it.
The loan pays the rest in stages. The bank pays each later stage to the developer as it falls due. You pay interest only on what has been paid out so far. This is called progressive interest. In the early years, while only part of the loan is out, the monthly sum is lower than the full instalment of about RM 2,201. Once the whole loan is paid out, the full instalment starts.
Late payment by you. If a stage stays unpaid after the 30 days, the Schedule H form lets the developer charge late payment interest at 10% a year on the unpaid sum, counted day by day.
Late delivery by the developer. If vacant possession comes after 36 months, the developer pays damages at 10% a year of the price. On RM 500,000 that is RM 50,000 a year, about RM 137 a day. Six months late would be about RM 25,000.
Late common facilities. Common facilities must also be completed within 36 months. If they are late, the damages are 10% a year on the last 20% of the price: on RM 500,000, that is 10% of RM 100,000, so RM 10,000 a year.
Costs on top. You pay the stamp duty on the transfer and, for the loan, 0.5% of your loan on the loan agreement. On RM 500,000 the transfer duty is RM 9,000 for a citizen or permanent resident, and the loan agreement duty is RM 2,250 on a RM 450,000 loan, unless an exemption applies. See the stamp duty guide.
Key terms inside the Schedule H SPA
- Vacant possession (VP). The developer must hand over the unit with a certificate of completion and compliance (CCC), with water and electricity ready for connection, and hand over the keys. See the VP guide and the CCC guide.
- Deemed VP. If you do not collect the keys, you are treated as having taken vacant possession 30 days after the developer's notice. Charges and the defect period can start from then.
- Defect liability period. Defects that show up within 24 months after VP, due to poor workmanship or materials, must be repaired by the developer within 30 days of your written notice. If not, you may repair them and claim the cost, following the steps in the form.
- Service charges. From VP you pay the maintenance charges and sinking fund. See maintenance fee and sinking fund.
- Strata title. The developer must deliver a valid transfer once the strata title is issued, and hand over the registered title within 30 days of registration.
- Termination. If you fail to pay and the SPA is ended, the developer may keep part of the price: 10% if up to half the price was paid, 20% if more. Read the clause with your lawyer.
What to check before you sign
- The right form. A strata unit from a licensed developer should be on Schedule H; a landed house on Schedule G.
- The developer's licence number and advertisement and sale permit number, both shown in the SPA.
- The unit details: parcel number, floor area, car park bays and accessory parcels, against the plans in the schedules.
- The price matches what you agreed, with nothing added through side letters.
- The date of the SPA. The 36-month or 24-month clock runs from this date.
- Your loan. Get a loan offer before you sign, or ask your lawyer how the SPA handles a rejected loan.
- Your lawyer. You may appoint your own lawyer; you do not have to use the developer's.
- The booking fee is counted towards the 10% and the receipt matches.
Mistakes buyers make
- Signing the booking form before checking whether the loan is likely to pass. See the DSR guide.
- Treating a side letter as part of the SPA without asking a lawyer.
- Not reading the deemed VP clause and missing the start of the defect period.
- Forgetting that the last 5% stakeholder sum gives leverage on defects.
- Assuming a subsale SPA has the same protections as a developer SPA.
Related terms
- VP (vacant possession)
- CCC (certificate of completion and compliance)
- MOT (memorandum of transfer)
- Margin of finance and loan-to-value
- MRTA vs MLTA
Check before you sign
This page explains how the standard SPA generally works for a strata home from a licensed developer in Peninsular Malaysia. It is not legal advice. Sabah and Sarawak have their own housing laws, and projects licensed before July 2015 may use older wording. Read the SPA with your own lawyer before you sign. A foreign buyer in Kuala Lumpur also needs consent from the land authority before the transfer. For help with a specific property, WhatsApp Shyan Yee (REN 46305, IQI Realty) at +60 17-279 8932.
Frequently Asked Questions
What is an SPA in Malaysia?
SPA stands for sale and purchase agreement. It is the contract between the buyer and the seller, or the developer, that sets the price, how and when you pay, when the home is handed over and what each side must do.
What are Schedule G and Schedule H?
They are standard SPA forms set under the Housing Development (Control and Licensing) Regulations 1989. Schedule G is used for a landed house and Schedule H for a unit in a building that is subdivided into parcels, such as a condominium or apartment. A licensed developer must use the right form and cannot change its key terms to the buyer's disadvantage.
How long does the developer have to hand over a condominium?
Under the Schedule H form, vacant possession must be delivered within 36 months from the date of the SPA. The landed-home form, Schedule G, sets 24 months. If the developer is late, it must pay liquidated damages at 10% a year of the purchase price, counted day by day.
How much do I pay when I sign the SPA?
Under the Schedule H payment schedule, 10% of the price is due on signing. The booking fee you paid earlier is normally counted towards this 10%. The rest is paid in stages as the building goes up, mostly through your loan.
Who pays the legal fees and stamp duty on the SPA?
Under the Schedule H form each side pays its own solicitors, and the buyer pays the stamp duty and registration fees for the agreement and the later transfer. Developers sometimes offer to bear some legal costs as part of a campaign; that is a separate offer, not part of the standard form.
Is a subsale SPA the same as a developer SPA?
No. The standard Schedule G and H forms apply to sales by a licensed developer of a housing project. In a subsale, from one owner to another, the SPA is drafted by the lawyers and the terms, such as the deposit and the completion period, are agreed between buyer and seller.
Written by
REN 46305 · IQI Realty Sdn Bhd · Kuala Lumpur
Licensed real estate negotiator focused on new launches in Kuala Lumpur, Selangor and Johor Bahru. Articles draw on developer material and site visits; prices and rules change, so confirm the latest before you buy.
Related articles
Need Personalized Advice on Malaysian Real Estate?
Speak with licensed senior agent Shyan Yee (REN 46305) for MM2H property consultations, state consent processing, and curated project shortlist.
WhatsApp Shyan Yee (+60 17-279 8932)