The stamp duty most first time buyers budget for and never have to pay

By the PropertyForFun creator. Published 29 August 2026. Malaysian writing for Malaysian.

SHORT ANSWER If this is your first home and it costs RM500,000 or less, your stamp duty is zero. Not reduced. Zero. That covers both the transfer of the title and the loan agreement. The exemption runs until 31 December 2027.

Most first time buyers in Malaysia still budget for stamp duty they do not have to pay. It is not their fault. A lot of the guides floating around were written before the exemption was extended, and nobody went back to update the numbers.

So people see a figure like RM9,000 or RM11,000 in a closing cost list, add it to their savings target, and decide they are not ready yet. For a house under RM500,000, that line should be RM0.

What exactly is exempt

Document	Normal cost	First timer, RM500k or below
Memorandum of Transfer (MOT)	1% to 3% tiered	RM0
Loan agreement	0.5% of the loan	RM0
Legal fees	Around 1% to 1.5%	Still payable
Valuation fee	Around 0.22%	Still payable

Note the last two rows. The exemption is on stamp duty only. Your lawyer still charges you, and the valuer still charges you. Anyone telling you the whole thing is free is selling something.

Do you qualify

You are a Malaysian citizen, and so is anyone buying with you
You have never owned residential property before. Not bought, not inherited, not gifted, not held jointly with a family member
The property is residential and priced at RM500,000 or below
Your sale and purchase agreement is signed between 1 January 2026 and 31 December 2027

That third point catches people out. If your name went onto a family property years ago, even as a co-owner who never lived there, you are not a first timer any more.

What it is worth in ringgit

Price	MOT duty	Loan duty at 90%	You save
RM300,000	RM5,000	RM1,350	RM6,350
RM450,000	RM8,000	RM2,025	RM10,025
RM500,000	RM9,000	RM2,250	RM11,250
RM520,000	RM9,600	RM2,340	RM0

Look at the last row. Twenty thousand ringgit more on the price, and you lose the whole exemption. A RM520,000 house does not cost RM20,000 more than a RM500,000 one. It costs about RM31,900 more once the stamp duty comes back.

Why so many guides get this wrong

Two of the most read property sources in Malaysia publish closing cost breakdowns that charge stamp duty to first time buyers below the threshold. One of them uses a worked example on a RM450,000 property and lists RM9,000 of stamp duty in the stack. That example is explicitly addressed to first time buyers, and for that reader the correct figure is zero.

This matters because of which way the error points. Overstating what you need by ten thousand ringgit does not protect anyone. It just tells people who could afford a house that they cannot.

What to do about it. When you see a closing cost list online, check the date and check whether it assumes you are a first timer. If the stamp duty line is not zero and you are buying below RM500,000, the list is out of date. Rebuild it yourself.

The line at RM500,000

There is a real cliff here, and it changes how you should search. Filtering up to RM520,000 because it feels close enough will quietly cost you eleven thousand ringgit.

Worth knowing too: a large share of Malaysia's unsold completed stock sits just above that line, in the RM500,000 to RM1,000,000 band. So the market has plenty of supply in exactly the price range where your exemption disappears. Below the line you get the tax break and a thinner selection. Above it you get more choice and a bigger bill. That is the actual trade.

Common questions

Is the stamp duty exemption still available in 2026?

Yes. It was extended in Budget 2026 and now runs until 31 December 2027, covering both the memorandum of transfer and the loan agreement for first time buyers of residential property priced at RM500,000 or below.

Does the exemption cover subsale, or only new projects?

Both. It applies to primary market purchases from a developer and to subsale purchases from an existing owner, as long as the property is residential and within the price cap.

How much stamp duty would I pay on a RM450,000 first home?

Nothing. Without the exemption it would be about RM8,000 on the transfer plus about RM2,025 on the loan agreement at a 90% margin of finance, so roughly RM10,025 in total. As an eligible first time buyer at that price you pay zero.

Do I still pay legal fees if the stamp duty is exempt?

Yes. The exemption removes stamp duty only. Legal fees on the sale and purchase agreement and the loan agreement are separate, and so is the valuation fee. Budget roughly 1.5% of the price for legal and about 0.22% for valuation.

I inherited a house years ago but never lived in it. Am I still a first time buyer?

No. The rule is that you have never owned residential property, and inherited or gifted property counts. Joint ownership counts too, even if you never occupied it.

What happens if the property costs RM520,000?

You lose the exemption entirely. There is no partial relief above RM500,000. On a RM520,000 purchase you would pay roughly RM9,600 on the transfer and about RM2,340 on the loan agreement.

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Why I built this game · First home stamp duty exemption · How much house can you afford · Cash you need on day one