Property Management and Landlord-Tenant Law
Tenancy or lease?
A tenancy for three years or less is exempt from registration under section 213(3) of the National Land Code; a lease exceeding three years must be registered. Other forms to recognise: periodic tenancy (monthly or yearly, rolling over), tenancy at will, and tenancy at sufferance where a tenant overstays.
What the agreement must cover
Parties, description of premises, term and renewal option, rent and reviews, security and utility deposits (commonly two to three months' security, half a month's utility, one month's advance rent), outgoings and service charges, repairs and maintenance, quiet enjoyment, use restrictions, assignment and subletting, default and forfeiture, and dispute resolution. Stamp duty on a tenancy is nominal, computed per RM250 of annual rent, and is the tenant's usual responsibility by practice.
Remedies and management
Distress for rent remains available in Peninsular Malaysia under the Distress Act 1951, alongside termination, forfeiture and court action. A landlord must mitigate loss on the tenant's repudiation and must honour quiet enjoyment. For stratified buildings, the Strata Management Act 2013 governs the joint management body, management corporation, by-laws and service charges; property management services must be provided by property managers registered with BOVAEP.
Traps
- Describing a two-year tenancy as a lease requiring registration.
- Assuming a security deposit may be used as the last month's rent.
- Forgetting that the deposit is held against damage and arrears, subject to the agreement's terms.
- Ignoring the duty to give notice and to follow lawful eviction procedure rather than self-help such as changing locks.
Rule of thumb
Read the default clause before advising on any remedy: termination rights, forfeiture and deposit forfeiture all depend on what the agreement actually says.