Glossary
SPA (Sale and Purchase Agreement)
The Sale and Purchase Agreement (SPA) is the legally binding contract between a property buyer and seller (or developer) in Malaysia. It outlines the terms of sale, purchase price, payment schedule, and obligations of both parties.
In Detail
In Malaysia, the SPA for new developments is governed by Schedule H (for strata properties like condos) or Schedule G (for landed properties) of the Housing Development Act. These schedules standardise the terms and provide buyer protections including a Defect Liability Period, liquidated damages for late delivery, and stage-payment schedules tied to construction progress. For subsale (secondary market) transactions, the SPA is negotiated between buyer and seller through their respective lawyers. Key clauses to watch include: completion period, default penalties, condition of the property, fixtures included, and any existing tenancy arrangements. Your conveyancing lawyer drafts and reviews the SPA. Both parties sign, and the buyer typically pays a 10% deposit upon execution (2% booking fee + 8% within 14 days). Stamp duty is then payable on the SPA within 30 days.
Investment Impact
A well-drafted SPA protects your investment. For new launches, the standardised Schedule H/G provides strong buyer protections. For subsale purchases, negotiate favourable terms on completion period and ensure the property is free from encumbrances. Always have your lawyer review before signing.