Fast Facts about Landlord Rights and Obligations in Malaysia

With no current legislation covering rental agreements in Malaysia, any disputes between landlord
and tenant can get quite tricky! No doubt, renting out your property is not as simple as purely
sitting at home waiting for the rental income to be generated to you each month.
As a landlord, there are certain rights and obligations that come with the role, such as property
upkeep, listing costs, agent fees, etc. This article will serve as a basic guide as to what rights and
obligations you have as a landlord in Malaysia.

1. The relevant laws that are related to tenancy

According to the National Land Code, a tenancy is ‘any tenancy or sub-tenancy for a term not
exceeding three years’ that does not require registration. A rental agreement that exceeds three
years will be considered as a ‘lease’ that requires registration.
Although there is no regulatory framework for tenancy agreements, the following laws do have a
provision to solve any disputes related to tenancy. Common Law or Case Law in this case is the
overarching framework which covers general rental disputes.
 Contracts Act 1950 – covers tenancy agreement conflicts.
 Civil Law Act 1956 – covers disputes regarding rental payments.
 Distress Act 1951 – covers matters of eviction.
 Specific Relief Act 1950 – states that landlords are prohibited from evicting the tenant or
changing the locks etc., without a court order.

2. A landlord’s rights and obligations

Usually the duties and obligations of both landlord and tenant are outlined clearly in the tenancy
agreement.
A landlord’s duties usually include:
 Paying the fees and charges related to the property, such as cukai tanah, cukai taksiran,
maintenance fees, etc.
 Maintaining the fire insurance for the property, as well as the major infrastructures such as
piping, electrical wiring etc.
 The landlord cannot use his/her set of keys to enter the unit without the tenant’s permission.
The landlord also doesn’t have the right to demand that the tenant allow him/her in without
valid reason.
However, there are some ‘unspoken rules’ as a landlord as well. These include common sense
practices such as respecting your tenant’s privacy, encouraging two-way communication and
being prompt in responding to your tenant, especially during emergency.

3. You need to have a well-written tenancy agreement

In No. 2, we mentioned that the duties and obligations for both landlord and tenant should be
clearly outlined in a tenancy agreement? So what is a tenancy agreement?
It is a legal covenant between the landlord and the tenant that provides a detailed description of
the rented property, the tenancy duration, rental payment amount and schedule, any furniture,
fixture and other amenities involved.
A tenancy agreement can be drafted by a professional lawyer. However, hiring lawyers can be
expensive, so some landlords opt to draft the agreement on their own to be agreed by the tenant.

4. What to include in a tenancy agreement?

A tenancy agreement is put in place to protect both the landlord and tenant, thus every statement
needs to be clearly worded and cover all possible scenarios. What is considered a well-
written tenancy agreement?
Basically, a tenancy agreement should include the following:
 Property details, such as type of property, its address, landlord and tenant contact, purpose of
tenancy, etc.
 Tenancy duration and renewal clauses.
 Rental and deposit amount, payment schedule and method
 What is provided by the landlord; any furniture’s, utilities, homewards etc.
 Landlord responsibilities and duties
 Tenant obligations, do’s and don’ts
 Consequences or penalties for late rental payments
 Terms and conditions on subletting / additional tenants
 Special clauses such as smoking, pets, access to amenities, etc.

5. What to do if my tenant fails to pay rent on time?

If your tenant does not pay the rent in a timely manner as outlined in the tenancy agreement, you
should seek the assistance of a lawyer and first give the tenant a notice to pay. If he / she still fails
to make payment, the landlord can serve the tenant a notice of termination and file a lawsuit to
obtain a court order.
Under the Special Relief Act 1950, landlords may not evict their tenants without a court order.
Thus as a landlord, you would have to follow the proper law processes on serving termination or
eviction notice if your tenant regularly fails to pay his / her rent on time.

6. What to do when disputes happen?

First things first, do not act out on emotion when disputes happen. As much as you would like to
resolve any messy situation with your tenant by giving him / her final ultimatum (ie. termination or
eviction); you should first, check the tenancy agreement.
A tenancy agreement falls under the Contracts Act, which assumes that all parties have willingly
and mutually agreed to all its terms. If the issue is clearly outlined in the tenancy agreement, then
you should resolve it according to the terms in the tenancy agreement that has been previously
agreed upon. If it is not covered in the agreement, then you may need further assistance from a
lawyer.

7. Select your tenants wisely

It goes without saying that as landlords, you would want to avoid any issues with your potential
tenant. Thus, before confirming your tenant, you should set your own standards and only select
the tenants that match your selection criteria. Additionally, it will be a good idea to check your
potential tenant’s background, such as his / her credit history or employment history. Do consider
getting references from his / her previous landlords or agents.
Being a landlord is not as easy as it sounds, and involves a lot more effort to make it work,
especially when it comes to property and tenant management. Thus, you need to be well-informed
of your rights and obligations as a landlord in Malaysia, so that you can further avoid unnecessary
conflicts with your tenant.
TENANCY LAW
Landlord and tenant are bound by the terms and conditions of the tenancy agreement. Tenancy
agreement is a contract involves a landlord and a tenant.
In absence of any agreement, the tenancy shall be deemed to be a monthly tenancy. Tenancy
agreement will specify the term and duration of the tenancy which would usually be for a period of
a year to three years. Any renewal with a possible rent adjustment should be mutually agreed
upon.
Tenancy agreements in Malaysia are covered by the Contracts Act 1950. Certain provisions of the
National Land Code 1965 contain provisions on leases and tenancies. Eviction of tenants is
covered in a couple sections in the Specific Relief Act 1950 and Distress Act 1951.
There is no one single law that governs the relationship between landlord and tenant. The case
laws will provide guidance on how the Court will interpret the laws and determine the rights of both
parties.
Prior to signing the Tenancy Agreement, an individual need to make sure of the following things:
1. Do Check the start date and end date of the agreed rental period as well as option to renew.
2. Make sure every tenant’s name is on the contract as well as the landlord’s.
3. Do take note of your obligations in details as to the said property while residing in it, and make
sure the said obligation was agreed by both parties.
4. Check the deposit and rental amount and make sure it is as per agreed.
5. Take note of the Termination clause as well as any special condition clause (e.g rules about
pet or smoking in rental home (if any)).