# Homebuyer Protection: The HDA, the Tribunal, and Abandoned Projects

> A guide to the statutory protection of homebuyers in Peninsular Malaysia — the developer's licence and APDL, how to check a developer before buying, filing a claim at the Homebuyer Claims Tribunal, and what happens when a project is declared abandoned.

- Category: property
- Language: en
- Status: published
- Updated: 2026-08-08
- Canonical: https://negaraku.md/en/property/homebuyer-protection-abandoned-projects

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You have paid the deposit, signed the Sale and Purchase Agreement, and are waiting for the keys — then the construction site falls silent for months. For buyers of new residential homes in Peninsular Malaysia, the law actually provides several layers of protection before, during, and after a situation like this arises. The key is knowing what is protected and where to turn when something goes wrong.

The backbone of that protection is the **Housing Development (Control and Licensing) Act 1966** — known as Act 118 or the HDA — together with its regulations. This guide explains three essential things: how to check a developer before buying, how to file a claim at the Tribunal, and what happens when a project is declared abandoned.

## What is the HDA and who does it protect?

Act 118 regulates developers who sell **primary-market residential homes** to the public in Peninsular Malaysia. It does not apply to subsale (secondary-market) purchases, and Sabah and Sarawak have their own housing enactments.

Protection begins with licensing. Under **Section 5**, "no housing development shall be carried out… except by a housing developer holding a licence issued under this Act." To qualify, a developer company must have a paid-up capital of not less than RM250,000 and deposit at least RM200,000, and must not have a director who has ever been convicted of fraud or is an undischarged bankrupt (Section 6).

Carrying out a housing development without a licence is a serious offence. Section 18 provides for a fine of **not less than RM250,000 and not more than RM500,000**, or imprisonment of up to **five years**, or both. That is why the single most important first step for a buyer is to confirm that the developer is indeed licensed.

## How do you check the developer's licence and APDL before buying?

Besides the developer's licence, a developer also needs an **Advertising Permit and Developer's Licence (APDL)** before it can advertise, open a sales gallery, or collect booking fees. A valid APDL number must be displayed on every advertisement and brochure.

KPKT provides a public portal, **TEDUH** (teduh.kpkt.gov.my), operated by the National Housing Department, where buyers can carry out the following checks free of charge:

| Check | What it confirms |
| --- | --- |
| Licensed Developers List | Whether the company holds a valid developer's licence that is still in force |
| APDL Status | Whether the project has an active Advertising Permit and Developer's Licence |
| Project Progress Status Check | The actual percentage of construction progress against marketing claims |
| Sick & Abandoned Projects List | Whether the project has been classified as delayed or abandoned |

A simple precaution: before paying any deposit, match the APDL number on the brochure against the records on TEDUH, and check the project's progress status. If the actual construction status lags far behind the marketing promises, or the project is already listed as "sick," that is an early warning sign.

## What are the main protections during and after purchase?

Once they have bought, buyers are protected by several statutory mechanisms:

- **Standard Sale and Purchase Agreement.** For landed homes, the terms of the agreement are prescribed in Schedule G; for stratified (high-rise) homes, in Schedule H. Developers cannot alter these key terms at will, including the completion period and liquidated ascertained damages (LAD) for late delivery.
- **Housing Development Account (HDA).** Collections from buyers must be paid into a separate project account and can only be withdrawn for the purposes of that project — limiting the risk of buyers' money being channelled elsewhere.
- **Defects liability period.** After handover, buyers can require the developer to repair defects within the period set by the agreement.
- **Homebuyer Claims Tribunal.** A low-cost forum for resolving disputes without having to go to the civil courts.

## How do you file a claim at the Homebuyer Claims Tribunal?

The Homebuyer Claims Tribunal (Tribunal Tuntutan Pembeli Rumah, TTPR) is established under Part VI of Act 118 as a cheap and fast channel for buyers to claim against licensed developers — for example, for damages for late delivery or failure to repair defects.

| Item | Details |
| --- | --- |
| Jurisdiction limit | Awards of up to RM50,000 (Section 16M) |
| Filing fee | RM10, using Form 1 |
| Time limit | Within 12 months from the CCC, expiry of the defects liability period, or termination of the SPA (Section 16N) |
| Legal representation | Not allowed unless there is a complex question of law |
| Award status | Final and binding; enforceable like a court order (Section 16AC) |

The basic steps: fill in Form 1, clearly stating the claim and its amount; file it at the counter of any Tribunal office or by post together with the fee; serve a copy on the developer as the respondent; and attend on the hearing date set.

A Tribunal award is not merely a recommendation. A developer's failure to comply with an award is an offence punishable by a fine of **RM10,000 to RM50,000** or imprisonment of up to **two years**, or both.

One important limit: if your loss exceeds RM50,000 — such as in a case of complete abandonment of the project — the Tribunal may not be an adequate forum, and a civil claim in court may be necessary.

## What happens when a project is declared abandoned?

A project is deemed **abandoned** when there is no significant construction activity on site for **six months or more** continuously, or when a winding-up petition is filed against the developer, a receiver and manager is appointed, or the developer admits in writing that it is unable to complete the project. This status is confirmed by the **Controller of Housing**, and a project may be declared abandoned by the Minister under **Section 11(1)(a)** of Act 118, and subsequently listed by KPKT.

Once a project is confirmed abandoned, several recovery routes exist:

- **Rehabilitation by an agency.** **Syarikat Perumahan Negara Berhad (SPNB)** — a housing company owned by the Minister of Finance (Incorporated), established in 1997 and now under KPKT's purview — has been appointed by the Ministry of Finance since 2001 as the implementing agent to rehabilitate abandoned housing projects, in cooperation with the relevant authorities and agencies.
- **Termination and refund.** For residential homes, buyers may be able to terminate the Sale and Purchase Agreement if the conditions are met, and claim a full refund within 30 days.
- **Action against the developer.** Under **Section 18A** of Act 118, a developer who abandons a project can be fined **RM250,000 to RM500,000** or imprisoned for up to **three years**, or both. This is an offence separate from carrying out a development without a licence under Section 18.

Bear in mind that rehabilitating an abandoned project can take years and the outcome is not guaranteed. That is why prevention — checking the licence, APDL, and progress status before buying — is far more valuable than recovery after a problem arises.

## Next steps

- **Before paying a deposit:** check the developer's name in the Licensed Developers List and confirm the APDL number at teduh.kpkt.gov.my.
- **Throughout construction:** monitor the Project Progress Status Check and keep all receipts and copies of the Sale and Purchase Agreement.
- **When a dispute under RM50,000 arises:** consider filing Form 1 at the Homebuyer Claims Tribunal for a RM10 fee.
- **If the project appears to have stalled:** check the Sick & Abandoned Projects List and obtain early legal advice, as substantial losses may require civil action.

This guide is general information and not legal advice. For specific cases, consult a qualified lawyer or the National Housing Department, KPKT.

## Sources

- Housing Development (Control & Licensing) Act 1966 (Act 118), consolidated text — https://www.hba.org.my/laws/hda/2007/ACT118(2007).htm (National House Buyers Association (HBA))
- Portal TEDUH — Jabatan Perumahan Negara, KPKT — https://teduh.kpkt.gov.my/ (Kementerian Perumahan dan Kerajaan Tempatan (KPKT))
- Perkhidmatan pelesenan dan pemajuan perumahan — https://ehome.kpkt.gov.my/index.php/pages/view/29 (Kementerian Perumahan dan Kerajaan Tempatan (KPKT))
- Malaysia — A Practical Guide To Filing A Claim At The Homebuyer's Tribunal — https://conventuslaw.com/report/malaysia-a-practical-guide-to-filing-a-claim-at-the-homebuyers-tribunal/ (Conventus Law)
- Abandoned Housing Projects in Malaysia — https://www.lowpartners.com/abandoned-housing-projects/ (Low & Partners)
- About SPNB — pemilikan Menteri Kewangan (Diperbadankan), penubuhan 1997, di bawah kawalan KPKT sejak 3 Ogos 2018 — https://spnb.com.my/en/about/ (Syarikat Perumahan Negara Berhad (SPNB))
- SPNB revives 1st abandoned housing project — MoF appointed SPNB as implementation agent for rehabilitation of abandoned housing projects in 2001 — https://www.hba.org.my/news/2006/306/spnb.htm (National House Buyers Association (HBA))
- Isu-isu Perumahan Masa Kini: Projek Perumahan Terbengkalai — definisi terbengkalai, Seksyen 11(1)(a) dan penalti Seksyen 18A — https://www.ezrilaw.com/post/isu-isu-perumahan-masa-kini-projek-perumahan-terbengkalai (Ezri Law Firm)

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Source of truth: https://github.com/negaraku-md/NegaraKu.md
License: CC BY-SA 4.0