Sale & Purchase Agreement (SPA)
Malaysia — Complete Guide 2026

This guide is for general information only and does not constitute legal advice. Always engage a licensed Malaysian solicitor for your property transaction.

What is a Sale and Purchase Agreement (SPA)?

A Sale and Purchase Agreement (SPA) is the primary legal contract that formally binds the buyer and seller in a property transaction in Malaysia. Once both parties sign and the deposit is paid, the SPA is legally enforceable — either party who defaults without lawful excuse is liable to the other for damages or specific performance.

The SPA covers the purchase price, deposit structure, payment schedule, delivery date, property description, title, conditions precedent (usually loan approval), defect obligations and remedies for default. It is the document your solicitor and bank work from throughout the transaction.

Types of SPA in Malaysia

There are two distinct categories of SPA, each governed by different rules:

The statutory Schedule G/H forms are the most buyer-protective — they include mandatory DLP, LAD, progressive payment schedules and a bar on waiving statutory rights. (Source: HDR 1989, Third Schedule; Act 118, s.24)

The 10% deposit

For both statutory and negotiated SPA, the standard deposit structure is:

• Booking deposit (earnest deposit): Typically 2–3% of the purchase price, paid when you sign the Letter of Offer / booking form — before the SPA is prepared.
• Balance deposit (on SPA signing): The remaining amount to make up 10% total of the purchase price, paid when the SPA is executed.
• Balance purchase price (90%): Typically funded via a housing loan and released progressively (for new property) or in a lump sum on completion (sub-sale).

For new property, the statutory Schedules G and H cap the pre-SPA booking deposit at a level such that total deposits before SPA cannot exceed 10% of the purchase price. (Source: HDR 1989, Sch G cl.4; Sch H cl.4)

Forfeiture risk: If you withdraw from the transaction after the SPA is signed without a valid condition precedent (e.g. you fail to get a loan), the seller may forfeit your 10% deposit. Always secure your loan approval before signing.

Key SPA clauses every buyer must understand

New property SPA vs sub-sale SPA — key differences

Completion timelines

For new property under the statutory schedules:

• Schedule G (landed): VP must be delivered within 24 months from SPA date. Extension possible via KPKT approval (does not waive LAD without buyer consent).
• Schedule H (strata): VP must be delivered within 36 months from SPA date.

For sub-sales, the completion period is negotiated — typically 3 months from the SPA date for a cash purchase, and 3–4 months to allow for loan documentation. The SPA will specify extension rights and the interest penalty for late completion.

Stamp duty on the SPA

Every SPA in Malaysia must be stamped under the Stamp Act 1949 within 30 days of execution (signing). Unstamped documents are inadmissible as evidence in court. Stamp duty on a residential SPA is assessed on the purchase price or market value (whichever is higher) on an ad valorem scale. (Source: Stamp Act 1949, First Schedule)

First-time homebuyers may qualify for stamp duty exemptions under periodic government schemes announced in Budget. Check the current LHDN guidelines for the latest applicable exemptions. (Source: LHDN — Inland Revenue Board of Malaysia)

For more detail, see our dedicated stamp duty guide for Malaysia →.

Legal fees (conveyancing)

Solicitor fees for preparing and completing an SPA are prescribed by the Solicitors Remuneration Order (SRO 2023) on a sliding scale based on the transaction value. These are payable by the buyer (for the buyer’s solicitor) and the seller (for the seller’s solicitor). In some new property transactions, the developer bears the legal fees for the SPA as part of the package.

For indicative Klang Valley conveyancing cost ranges, see our conveyancing legal fees guide →.

The SPA signing process

Red flags — what to watch out for before signing

• Addenda reducing your statutory rights — any clause limiting DLP duration, removing LAD or requiring you to waive TTPM rights is void under Act 118 but still a sign of a developer trying to limit liability.
• Unusually short conditions precedent window — 7–14 days is too short to arrange financing; push for at least 21–30 days.
• No individual title issued for old sub-sale property — check whether a Master Title or Deed of Assignment is in use and engage a solicitor to verify the chain of title.
• Developer without a valid Ad Permit or Licence — verify on KPKT’s e-services portal before paying any deposit.
• Caveats or charges on the title — ask your solicitor to run a land search before signing.

Also read our dedicated guides on HDA homebuyer rights → and Memorandum of Transfer (MOT) →.

After signing the SPA — what happens next?

• For new property: Track construction milestones; confirm each progress claim matches the SPA payment schedule; note the VP deadline for LAD purposes.
• For sub-sale: Solicitor lodges a private caveat to protect the buyer’s interest; loan documentation is executed; on completion, Memorandum of Transfer (Form 14A) is presented to the land office for registration.
• Post-handover: Start the DLP clock (new property); submit any defects in writing within 24 months.

Sources & official references

• Housing Development (Control and Licensing) Act 1966 (Act 118) — Attorney General’s Chambers portal (laws.agc.gov.my)
• Housing Developers (Control and Licensing) Regulations 1989 (HDR 1989) — Third Schedule, Schedules G and H
• Stamp Act 1949 (Act 378) — First Schedule ad valorem duty on instruments of transfer
• LHDN (Inland Revenue Board of Malaysia) — hasil.gov.my; stamp duty procedures and exemptions
• KPKT (Ministry of Local Government Development) — kpkt.gov.my; housing developer licence verification
• Solicitors Remuneration Order 2023 (SRO 2023) — Bar Council Malaysia