The Defect Liability Period: How to Enforce Your Rights on a New Property in Malaysia

Purchasing a brand-new property in Malaysia is an exciting milestone, but the journey doesn’t end when you receive your keys. What happens when you discover cracks in the walls, leaking pipes, or malfunctioning fixtures weeks or months after moving in? This is where the Defect Liability Period (DLP) becomes your most powerful legal protection as a property buyer. Understanding how to properly exercise your rights during this critical window can mean the difference between getting defects fixed at no cost to you and bearing expensive repair bills yourself.

The Malaysian property market, particularly in major urban centers like Kuala Lumpur, Penang, and Johor Bahru, has seen tremendous growth in new residential developments over the past decade. With this growth comes the increased importance of understanding your legal protections. The Defect Liability Period is enshrined in the Housing Development Act and your Sale and Purchase Agreement (SPA), giving you a legally-backed timeframe to report construction defects and demand repairs from your developer. For foreign investors and first-time buyers navigating the Malaysian property landscape, knowing how to leverage this protection is essential, as detailed in our complete guide to investing in Malaysia.

However, many property buyers unknowingly forfeit their rights by missing crucial deadlines, failing to document defects properly, or not following the correct claim procedures. According to data from the National House Buyers Association (HBA), thousands of homebuyers face challenges annually in getting developers to honor their DLP obligations, often due to procedural mistakes that could have been easily avoided.

In this comprehensive guide, we’ll walk you through everything you need to know about the Defect Liability Period in Malaysia: what it covers, how long it lasts, the step-by-step process to file claims, essential documentation requirements, what to do when developers don’t respond, and real case studies showing both successful and unsuccessful claims. Whether you’ve just received your keys or are about to take vacant possession, this guide will equip you with the knowledge to protect your investment and enforce your legal rights effectively.

Understanding the Defect Liability Period in Malaysian Property Law

The Defect Liability Period represents a critical legal framework that protects property buyers in Malaysia from construction defects and workmanship issues in newly completed properties. This protection is not merely a goodwill gesture from developers—it’s a mandatory legal requirement embedded in Malaysian housing legislation.

What is the Defect Liability Period (DLP)?

The Defect Liability Period is a defined timeframe following the completion of a property during which the developer remains legally responsible for rectifying any defects in workmanship, materials, or construction that become apparent. Think of it as a warranty period specifically for property construction. During this period, buyers have the legal right to report defects and demand that the developer fix them at no additional cost.

This protection applies to properties purchased directly from licensed housing developers under the Housing Development (Control and Licensing) Act 1966 (HDA). It’s important to note that the DLP typically does not apply to subsale properties or properties purchased from unlicensed developers, which is one reason why understanding the fundamentals of Malaysian real estate investment is crucial before committing to a purchase.

Legal Framework: Housing Development Act and SPA Provisions

The legal foundation for the Defect Liability Period comes from two primary sources. First, the Housing Development (Control and Licensing) Act 1966 and its associated regulations establish the mandatory framework that all licensed developers must follow. Second, your Sale and Purchase Agreement (SPA)—the contract between you and the developer—contains specific clauses detailing the DLP terms, including duration, scope, and procedures for claiming defects.

Schedule G and Schedule H of the Housing Development (Control and Licensing) Regulations 1989 contain the standard SPA forms that developers must use, with built-in protections for buyers. According to the Ministry of Housing and Local Government, these standardized agreements ensure consistent protection across all regulated property transactions in Malaysia.

DLP Duration: 24 Months vs 12 Months Explained

One of the most common sources of confusion among property buyers concerns the actual duration of the Defect Liability Period. The standard DLP in Malaysia operates on a two-tier system based on the nature of the defect:

24-Month Period: Structural defects are covered for a period of 24 months (two years) from the date of vacant possession or the issuance of the Certificate of Completion and Compliance (CCC), whichever is later. Structural defects include serious issues affecting the integrity of the building such as foundation problems, major cracks in load-bearing walls, structural water seepage, roof leaks, and defects in the main building structure.

12-Month Period: Non-structural defects are covered for 12 months (one year) from the same starting date. These include issues with fixtures, fittings, finishes, doors, windows, plumbing fixtures, electrical fittings, tiles, paintwork, and other non-load-bearing elements.

This two-tier system recognizes that structural problems may take longer to manifest than superficial defects. For example, a foundation settlement issue might not become apparent for several months, while a faulty door lock would be immediately noticeable.

When Does the DLP Start? Vacant Possession Date Clarified

The starting point of your Defect Liability Period is crucial to understand because it determines your deadlines for reporting defects. The DLP officially begins on the date of vacant possession (VP) or the date of issuance of the Certificate of Completion and Compliance (CCC), whichever is later.

Vacant possession occurs when the developer hands over the completed unit to you, and you’re legally entitled to occupy it. This is typically formalized through a Vacant Possession Certificate signed by both parties. Even if you don’t immediately move in or collect your keys, the VP date starts your DLP clock ticking.

The Certificate of Completion and Compliance (CCC), previously known as the Certificate of Fitness for Occupation (CFO), is issued by the local authority certifying that the building complies with approved plans and building regulations. If there’s a delay between VP and CCC issuance, your DLP period is calculated from the later date, providing you with additional protection.

For instance, if you received vacant possession on January 1, 2024, but the CCC was only issued on March 1, 2024, your 12-month non-structural DLP would run until March 1, 2025, and your 24-month structural DLP would extend to March 1, 2026.

Types of Defects Covered Under the DLP

Understanding exactly what types of defects fall under DLP protection is essential for knowing when you can legitimately demand repairs from your developer. Not all issues that arise in a new property qualify as defects under the DLP framework.

Structural Defects: Foundation, Walls, and Load-Bearing Elements

Structural defects represent the most serious category of construction problems and are covered for the full 24-month period. These defects affect the fundamental integrity, safety, or stability of the building structure. Common structural defects include:

Foundation Issues: Settlement cracks, subsidence, or movement in the foundation that can cause doors and windows to jam, cracks in walls, or uneven floors. These are particularly serious as they can compromise the entire building’s stability.

Structural Cracks: Significant cracks in load-bearing walls, columns, beams, or slabs. Not all cracks are structural—hairline cracks from concrete curing are generally considered normal. Structural cracks are typically wider than 2mm, diagonal, or show signs of movement.

Water Seepage: Water penetration through external walls, roofs, or structural elements. This differs from plumbing leaks; structural water seepage occurs due to inadequate waterproofing during construction and often appears after heavy rain.

Roof Defects: Leaking roofs, improperly installed roof structures, or failed waterproofing membranes that allow water penetration into the living spaces below.

Structural Displacement: Any noticeable shifting, tilting, or movement of structural elements that wasn’t part of the original design specifications.

Non-Structural Defects: Fixtures, Fittings, and Finishes

Non-structural defects, covered for 12 months, encompass a wide range of issues related to the finishing, fixtures, and non-load-bearing components of your unit. These don’t compromise the building’s structural integrity but affect functionality and aesthetics:

Doors and Windows: Warped doors, misaligned frames, broken locks, cracked glass, windows that don’t close properly, or doors that scrape the floor.

Flooring Issues: Cracked tiles, uneven tiling, hollow-sounding tiles indicating poor adhesion, damaged parquet, or poorly finished concrete floors.

Plumbing Defects: Leaking pipes, faulty fixtures, poor water pressure, improperly installed sanitary ware, blocked drains, or malfunctioning toilets and faucets.

Electrical Problems: Non-functioning power points, faulty switches, improper wiring, circuit breaker issues, or light fixtures that don’t work.

Paintwork and Finishing: Peeling paint, uneven surfaces, poor plastering, visible construction debris embedded in finishes, or color mismatches from specifications.

Built-in Fixtures: Defective kitchen cabinets, wardrobes, countertops, or other developer-provided fixtures specified in your SPA.

According to data from EdgeProp Malaysia, non-structural defects account for approximately 80% of all DLP claims, with plumbing and tiling issues being the most commonly reported problems in new developments.

Common Property Defects in Stratified Developments

For purchasers of high-rise condominiums, apartments, or stratified properties, the DLP also extends to common property areas. These are spaces shared by all residents, and defects here should be reported collectively through your Joint Management Body (JMB) or Management Corporation (MC):

Common Areas: Lobbies, corridors, staircases, lifts, car parks, swimming pools, gymnasiums, function rooms, and landscaped areas.

Building Systems: Fire safety systems, water supply infrastructure, sewerage systems, electrical substations, generator rooms, and CCTV systems.

External Works: Building facades, external waterproofing, drainage systems, perimeter fencing, and access roads within the development.

Collective action through your JMB or MC is often more effective for common property defects, as a unified complaint from multiple owners carries more weight than individual reports. The developer’s obligation to maintain common property during the DLP is explicitly covered in the Housing Development Act provisions.

What’s NOT Covered: Exclusions and Limitations

Understanding what the DLP doesn’t cover is equally important to avoid unrealistic expectations and wasted effort. Common exclusions include:

Normal Wear and Tear: Deterioration from regular use over time is not a defect. For example, scratches on floors from moving furniture, faded paint from sun exposure, or worn carpet from foot traffic.

User-Caused Damage: Any damage resulting from the occupant’s actions, negligence, or modifications. If you drill into a pipe while installing shelves, that’s not a DLP defect.

Alterations and Renovations: Once you begin renovations, it becomes difficult to prove whether defects were pre-existing or caused by your renovation works. This is why conducting a thorough inspection before renovation is crucial, as discussed in our guide to building permits and renovations in Malaysia.

Natural Shrinkage: Minor hairline cracks (typically under 1mm) in concrete and plaster due to natural curing and settlement are generally considered acceptable and not defects.

External Factors: Damage from natural disasters, vandalism, or force majeure events beyond the developer’s control typically aren’t covered.

Aesthetic Preferences: Dissatisfaction with design choices, color schemes, or layout that were part of the approved specifications isn’t a defect—it’s a personal preference issue.

Conducting Your Initial Property Inspection

The foundation of a successful DLP claim starts with a thorough and properly documented initial inspection of your property. Many defects that could have been claimed are lost forever because buyers failed to identify and record them during this critical window.

Best Time to Inspect: Before Taking Vacant Possession

Ideally, you should conduct your most comprehensive inspection before officially accepting vacant possession. Once you sign the VP acceptance document, you’re acknowledging receipt of the property, and any defects you discover afterward must be claimed within the DLP timeframes.

Most developers provide a brief inspection opportunity (typically 1-2 hours) during the handover appointment. This is rarely sufficient for a thorough examination. If possible, negotiate with your developer for an earlier inspection appointment several days before the official handover, giving you adequate time for a detailed review.

If you’ve already taken VP without a thorough inspection, don’t panic—you still have the full DLP period to report defects. However, you should conduct a comprehensive inspection as soon as possible, ideally within the first few weeks of possession, to identify issues before they’re complicated by your occupancy or renovations.

Creating a Comprehensive Defect Checklist

A systematic approach ensures you don’t miss defects. Create a room-by-room checklist covering these key areas:

General Structure: Check all walls, ceilings, and floors for cracks, unevenness, water stains, or hollow sounds when tapped (indicating poor plastering or tile adhesion).

Doors and Windows: Open and close every door and window multiple times. Check for smooth operation, proper alignment, intact glass, functioning locks, and proper sealing. Look for gaps that might allow water or pest entry.

Electrical System: Test every power point with a device. Check all light switches and fixtures. Verify that circuit breakers are properly labeled and functioning.

Plumbing: Run water in all taps, showers, and toilets for several minutes. Check for leaks underneath sinks and around toilet bases. Verify hot water systems work. Check for adequate water pressure. Flush all toilets and check drainage speed.

Tiles and Flooring: Look for cracked, chipped, or poorly aligned tiles. Tap tiles to detect hollow sounds. Check grout condition and alignment. For timber flooring, look for warping, gaps, or damage.

Paintwork: Examine all painted surfaces for peeling, bubbling, uneven application, or incomplete coverage.

Built-in Fixtures: Open and close all cabinet doors and drawers. Check countertop installations. Verify all fixtures mentioned in your SPA are present and functional.

External Areas: For landed properties, inspect fencing, gates, driveways, drainage, and any external structures. For high-rise units, check balconies, planters, and external windows.

Should You Hire a Professional Inspector?

While hiring a professional property inspector involves additional cost (typically RM500-RM1,500 for a standard unit inspection), the investment can be worthwhile, particularly for high-value properties or first-time buyers unfamiliar with construction standards.

Professional inspectors bring several advantages: technical knowledge to identify non-obvious defects, experience with acceptable construction standards in Malaysia, detailed photographic documentation, professional inspection reports that carry weight with developers, and expertise in distinguishing between genuine defects and acceptable variations.

According to PropertyGuru Malaysia, professional inspections of new properties in major Malaysian cities typically identify an average of 15-30 defects per unit, with many being issues that untrained buyers would overlook.

If budget is a concern, consider sharing inspection costs with other buyers in your development, particularly for common property areas. Many inspection companies offer group rates for multiple units in the same building.

Documenting Defects: Photography and Description Guidelines

Proper documentation is absolutely critical. Your defect claims will stand or fall based on the quality of your evidence. Follow these documentation best practices:

Photographic Evidence: Take clear, well-lit photographs of every defect from multiple angles. Include close-up shots showing detail and wider shots showing location within the room. Use a ruler or coin in photos to show scale for cracks or gaps. Ensure photos are date-stamped (most smartphones do this automatically).

Video Documentation: For defects involving movement, sound, or water flow (such as leaking taps, misaligned doors, or drainage issues), video evidence can be more effective than photos.

Written Descriptions: For each defect, write a clear description including: the exact location (e.g., “Master bedroom, north-facing wall, 1.5 meters from the window”), nature of the defect (e.g., “Vertical crack, approximately 15cm long, 3mm wide”), and any functional impact (e.g., “Door cannot close completely, leaving 1cm gap”).

Floor Plans: Mark defect locations on your unit’s floor plan for easy reference and to help contractors locate issues during rectification.

Organization: Create a master document (digital spreadsheet or document) listing all defects with corresponding photo references, descriptions, and locations. This will form the basis of your official defect notification to the developer.

Step-by-Step: How to File a Defect Claim

Once you’ve identified and documented defects, the next critical step is properly filing your claim with the developer. Following the correct procedure and timelines is essential for protecting your legal rights under the DLP.

Step 1: Prepare Your Written Defect Notice

Verbal complaints or informal notifications are not sufficient. You must submit a formal written defect notice to invoke your DLP rights. Your defect notice should include:

Your Identifying Information: Full name as per the SPA, IC or passport number, unit address, SPA reference number, and contact details (phone number and email).

Property Details: Complete unit address, project name, VP date, and CCC date if available.

Defect List: Comprehensive numbered list of all defects, organized by location (e.g., all living room defects together). For each defect, provide a clear description, location, and reference to supporting photographs.

Supporting Documents: Attach all photographic evidence, labeled clearly to correspond with your defect list. If you have a professional inspection report, include it.

Legal References: Reference the relevant clauses in your SPA regarding the DLP and the developer’s obligation to rectify defects.

Request for Action: Clearly state that you are requesting the developer to inspect and rectify the listed defects within a reasonable timeframe in accordance with your SPA and the Housing Development Act.

Date and Signature: Date your notice and sign it. If you’re filing jointly with other buyers (for common defects), all parties should sign.

Step 2: Submit to the Correct Developer Contact

Identifying the correct submission channel is crucial. Your SPA should specify the developer’s official address for defect notifications. This is typically the developer’s registered office address, though some developers also provide specific defect management contacts or customer service departments.

Submit your defect notice through multiple channels for maximum protection:

Registered Mail: Send via Pos Malaysia registered mail (PosLaju or registered post) with acknowledgment of receipt. This provides dated proof of delivery.

Email: Send to the official developer email address specified in your SPA and request a read receipt. Keep the email confirmation as evidence.

Hand Delivery: If practical, hand-deliver a copy to the developer’s office and request a stamped acknowledgment copy as proof of receipt with date.

Never rely solely on informal channels like WhatsApp messages to site supervisors or verbal notifications to sales staff. These don’t constitute proper legal notice.

Step 3: The 30-Day Notification Rule

While the DLP gives you 12 or 24 months to identify defects, many SPAs require you to notify the developer within 30 days of discovering a defect (or within 30 days of VP for initially visible defects). This is a critical timeline that many buyers miss.

The practical implication: conduct your comprehensive inspection and submit your initial defect notification within 30 days of taking VP. This protects you from any arguments that you failed to provide timely notice.

For defects that only become apparent later (such as water seepage that only occurs during heavy rain, which you might not experience immediately), you should report these within 30 days of discovery, clearly documenting when the defect first became apparent.

Missing this 30-day notification window doesn’t necessarily forfeit your entire DLP protection—the developer still has repair obligations throughout the full DLP period—but it can weaken your position and give developers grounds to dispute claims.

Step 4: Following Up and Tracking Your Claim

After submitting your defect notice, maintain detailed records of all interactions with the developer. Create a tracking system that logs dates of all communications, names of developer representatives you speak with, commitments made, and action items.

Follow up systematically if you don’t receive acknowledgment within one week of submission. Contact the developer’s customer service department to confirm receipt and inquire about the next steps.

Request a written response from the developer that should include acknowledgment of your claim, an inspection schedule (the developer will typically want to send their own team to assess the defects), an estimated timeline for rectification works, and the name of a contact person for your case.

Keep all correspondence organized chronologically. This documentation becomes crucial evidence if you need to escalate to the Tribunal for Homebuyer Claims or pursue legal action.

Essential Documentation for Defect Claims

Successful DLP claims rely heavily on proper documentation. Missing documents can delay or even invalidate otherwise legitimate claims. Understanding what you need and keeping these documents organized is essential for protecting your rights, much like understanding the documentation requirements when financing your property purchase.

Mandatory Documents: SPA, CCC, and VP Certificate

These three documents form the foundation of any DLP claim:

Sale and Purchase Agreement (SPA): Your SPA contains the specific DLP clauses governing your property, including the duration of the DLP, developer’s obligations, procedures for notification, and timelines for rectification. Keep the original in a safe place and make multiple copies for working purposes. Highlight the relevant DLP clauses for easy reference.

Certificate of Completion and Compliance (CCC): Also known previously as Certificate of Fitness for Occupation (CFO), this document from the local authority confirms the building meets regulatory requirements and determines one of the potential start dates for your DLP period. Request a copy from your developer if you haven’t received it—you’re entitled to this document.

Vacant Possession Certificate or Letter: This document, issued when you collect your keys and take possession, establishes the VP date—the other potential start date for your DLP. This might be a formal certificate, a letter, or clauses in a delivery receipt you signed at handover.

Understanding the precise dates from these documents is critical because they determine your claim deadlines. If your VP date was June 1, 2024, and your CCC was issued June 15, 2024, your DLP runs from June 15, 2024, meaning non-structural defects must be claimed by June 15, 2025, and structural defects by June 15, 2026.

Defect Notification Form Templates

While not always mandatory, using a structured defect notification form demonstrates professionalism and ensures you include all necessary information. Many developers provide their own defect notification forms, which you should use if available as they’re designed to work with the developer’s internal processes.

If no official form is provided, create your own using a standard business letter format. Templates are often available from the National House Buyers Association (HBA), which provides resources for homebuyers navigating DLP claims.

Your defect notification should follow a standard format: header with your details and developer details, reference line (e.g., “RE: Defect Liability Notification for Unit 15-08, XYZ Residence”), clear subject line, formal salutation, introduction stating your purpose and referencing relevant SPA clauses, comprehensive defect list organized by room/location, request for inspection and rectification with reasonable timeframe, closing with your contact information and availability for developer inspection, and formal closing with signature and date.

Photographic Evidence Requirements

High-quality photographic evidence is your strongest tool in proving defects exist. However, not all photos are equally valuable. Follow these guidelines for maximum effectiveness:

Technical Quality: Use adequate lighting—natural daylight is best. Avoid flash photography that creates glare on tiles or wet surfaces. Ensure focus is sharp and the defect is clearly visible. Use the highest resolution setting on your camera or smartphone.

Comprehensive Coverage: For each defect, take multiple photos: wide shot showing the defect’s location in the room, medium shot showing context, and close-up showing detail. Include reference objects (ruler, coin, or standard-sized item) for scale in crack or gap photos.

Date Stamping: Enable date and time stamps on your camera if possible. Most smartphones do this in the photo’s metadata by default. This proves when defects were photographed, important for demonstrating timely reporting.

Organization: Name your photo files systematically (e.g., “MasterBedroom_WallCrack_01.jpg”, “MasterBedroom_WallCrack_02.jpg”). Create folders organized by room or defect type for easy reference.

Backup: Store copies in multiple locations—your computer, cloud storage (Google Drive, Dropbox), and an external drive. Losing your only copy of evidence can invalidate your entire claim.

Maintaining a Correspondence Trail

Every interaction with the developer regarding defects should be documented. This correspondence trail becomes critical evidence if disputes arise or escalation becomes necessary.

Written Communications: Keep copies of all letters, emails, and formal notices sent to and received from the developer. Print hard copies of important emails for backup.

Phone Call Logs: After any phone conversation with the developer, send a follow-up email summarizing the discussion, including who you spoke with, date and time, topics discussed, commitments made, and agreed next steps. Ask for email confirmation if important commitments were made.

Meeting Minutes: If you attend face-to-face meetings or site visits with the developer’s team, take notes and send a follow-up email summarizing what was discussed and agreed. Ask attendees to confirm accuracy.

Inspection Records: When the developer sends representatives to inspect defects, be present if possible. Take your own notes and photos of what they inspect. Request a copy of their inspection report or at minimum, get their acknowledgment in writing of what defects were confirmed.

Work Authorization: Before the developer begins rectification works, ensure you have written confirmation of what will be fixed, the timeline, and who will be doing the work. This prevents disputes about what was supposed to be repaired.

Creating a simple spreadsheet or document that chronologically logs all interactions creates a powerful timeline of your good-faith efforts to resolve defects through proper channels—essential evidence if you need to demonstrate to the Tribunal that you exhausted reasonable remedies before escalating.

Developer Obligations and Response Timeframes

Understanding what developers are legally required to do during the DLP helps you hold them accountable and recognize when they’re failing to meet their obligations. This knowledge empowers you to take appropriate action when necessary.

Legal Obligations of Developers Under Malaysian Law

The Housing Development Act and standard SPA provisions impose clear obligations on licensed developers during the Defect Liability Period:

Rectification Duty: Developers must rectify all genuine defects reported within the DLP timeframe at their own cost. This is not discretionary—it’s a legal obligation.

Inspection Requirement: Developers must conduct proper inspections of reported defects within a reasonable timeframe (typically 7-14 days of notification, though this varies by SPA terms).

Quality Standards: Rectification work must meet the same quality standards as the original construction and comply with approved building specifications and Malaysian building codes.

Access Facilitation: Developers must coordinate with buyers for reasonable access to conduct inspections and repairs, providing adequate notice (typically 24-48 hours).

Common Property Maintenance: For stratified properties, developers must maintain common property in good condition during the DLP, addressing defects in shared facilities, building systems, and external works.

Response Obligation: Developers must provide written responses acknowledging defect claims, outlining assessment results, committing to rectification timelines, or explaining why reported issues don’t qualify as DLP defects.

According to Bank Negara Malaysia housing sector reports, compliance with DLP obligations is one of the key metrics monitored in evaluating developer performance and licensing requirements.

Typical Response and Rectification Timelines

While specific timelines vary by SPA, typical industry standards and reasonable expectations include:

Acknowledgment: Developers should acknowledge receipt of your defect notification within 7 working days, either confirming receipt or requesting clarification on specific items.

Inspection Scheduling: Initial inspection of reported defects should be scheduled within 14 days of notification. For urgent defects affecting habitability (such as major water leaks or electrical hazards), inspection should occur within 48-72 hours.

Assessment Report: Following inspection, the developer should provide a written assessment within 14-21 days, categorizing defects as: confirmed and will be rectified, requires further investigation, or not considered a defect under DLP terms (with explanation).

Rectification Timeframe: For confirmed def