Description
- A Lease Agreement is a legally binding contract between a landlord (lessor) and a tenant (lessee) that outlines the terms and conditions for renting a property. It establishes the rights and obligations of both parties, covering aspects such as rent payment, property usage, and maintenance responsibilities.
GOV Department
- Kementerian Perumahan dan Kerajaan Tempatan (KPKT) / Ministry of Housing and Local Government
License Name (Malay)
- Perjanjian Pajakan
Details
- The agreement specifies the lease duration, rental amount, security deposit, and permitted use of the property.
- It includes terms for property maintenance, renewal, and termination.
- Applicable for residential, commercial, and industrial properties.
- Ensures compliance with local property laws, such as the Rental Control Act or applicable housing regulations.
Important Rules
- The lease agreement must be signed by both parties to be enforceable.
- Security deposits should not exceed two months’ rent for residential properties unless specified otherwise.
- Both parties must adhere to the terms related to rent payment, property maintenance, and notice periods for termination.
- The tenant cannot sublease or alter the property without the landlord’s consent.
- Agreements exceeding a certain duration may require stamping under the Stamp Act 1949 to be legally binding.
Compound & Punishment
- Failure to properly document or stamp the agreement may result in:
- The agreement being inadmissible in court during disputes.
- Fines or penalties for non-compliance with local laws.
- Breach of the lease terms, such as non-payment of rent or unauthorized use of the property, may lead to:
- Termination of the lease.
- Legal action and possible monetary damages.
Advisor
Penny Lim , Legal Consulting
Ms. Penny is responsible for identifying possible legal issues and implementing solutions in the areas of government regulation, customer protection, and fair employment. Legal Counsel. Ms. Penny can advise on legal issues such as government and business permits, review legal documents before signing them, and complete legal research as needed by the company
Commonly Asked Questions
A Lease Agreement is a legally binding contract between a landlord (lessor) and a tenant (lessee) that defines the terms for renting a property. It includes details such as rental amount, duration, maintenance, and termination conditions to protect the rights of both parties.
A Lease Agreement usually applies to long-term rentals (typically more than 3 years) and is often registered with the land office, while a Tenancy Agreement covers short-term rentals (usually less than 3 years) and doesn’t require registration.
Yes. A written Lease Agreement is strongly recommended for all property rentals. It serves as legal proof of the arrangement and helps resolve disputes regarding rental payments, property usage, and termination.
Yes. Under the Stamp Act 1949, all Lease Agreements must be stamped by the Inland Revenue Board (LHDN) within 30 days of signing to make them legally enforceable in court.
A standard Lease Agreement includes:
- Rental amount and payment schedule
- Lease duration and renewal terms
- Security deposit details
- Property maintenance responsibilities
- Terms for termination and dispute resolution
In Malaysia, landlords may collect up to two months’ rent as a security deposit and half a month’s rent for utilities, unless otherwise agreed upon in writing.
No. Tenants cannot alter, renovate, or sublease the property without the written consent of the landlord. Any unauthorized modifications may lead to termination or legal action.
Failure to pay rent is a breach of the Lease Agreement. The landlord may issue a notice of default, terminate the lease, and seek legal remedies such as eviction or recovery of outstanding rent.
Yes. Lease Agreements apply to residential, commercial, and industrial properties, with terms adjusted based on property type and business requirements.
If a Lease Agreement is not properly stamped, it:
- Cannot be used as evidence in legal disputes.
- May result in fines or penalties under the Stamp Act 1949.
- Exposes both parties to legal and financial risks due to lack of enforceability.