Budget 2026: Stamp Duty Exemptions Extended For Homebuyers
Samuel Chua
10th October 2025 - 2 min read
The government has extended and introduced several property-related measures under Belanjawan MADANI 2026 to make housing more accessible, control property prices, and encourage the redevelopment of existing spaces into residential use.
Extended Stamp Duty Exemption For First-Time Homebuyers
The stamp duty exemption for first-time homebuyers purchasing residential properties priced up to RM500,000 will be extended for another two years, until 31 December 2027.
This exemption applies to both the property transfer instrument and the loan agreement, helping Malaysians, especially young and middle-income buyers, reduce upfront costs when purchasing their first home.
Higher Stamp Duty For Foreign Property Buyers
Foreign buyers, including non-citizens and foreign companies, will be subject to a flat stamp duty rate of between 4% and 8%, depending on the value of the property.
Permanent residents are exempted from this higher rate. The measure aims to ensure the property market remains competitive and to prevent excessive price increases that could affect affordability for Malaysians.
Support For Rent-To-Own And Build-Then-Sell Housing Schemes
Aligned with the 13th Malaysia Plan (RMK13), the government is encouraging financial institutions to support the implementation of rent-to-own (RTO) and build-then-sell (BTS) housing schemes.
These programmes aim to increase homeownership options while ensuring more stable and transparent property delivery systems.
Tax Deduction For Developers Converting Commercial Buildings
Developers that convert commercial buildings into residential properties will be eligible for a special tax deduction of 10% on qualifying expenditures, capped at RM10 million.
This incentive encourages the conversion of underutilised commercial spaces into homes, helping address housing demand in urban areas.
Allocation For Non-Muslim Houses Of Worship
To maintain places of worship for Malaysia’s multi-faith communities, the government has allocated RM50 million for the repair and maintenance of registered non-Muslim houses of worship across the country, including Sabah and Sarawak.
Supporting Affordability And Urban Renewal
Through these measures, Belanjawan MADANI 2026 aims to strengthen access to affordable housing, promote responsible investment, and revitalise urban spaces.
Stay tuned for more updates from Budget 2026.
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About THE AUTHOR
Samuel Chua
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Comments (5)
Is the 8% stamp duty applied retrospectively? Do you think it is fair for foreigners who have purchased a property in 2025 or before, and the transfer of ownership could only be perfected after 2025?
Hi there, thank you for raising that point — it’s a good question. Based on the Budget 2026 announcement, the higher 4%–8% stamp duty rate for foreign property buyers is still a proposal and has not yet taken effect. There’s currently no indication that it will apply retrospectively to purchases made before the new rate is implemented. In most cases, stamp duty changes in Malaysia only apply from the effective date stated in the Finance Bill or gazette, so earlier transactions are usually not affected. However, the exact treatment for transfers that are still being perfected after 2025 will depend… Read more »
Thanks for the clarification, Samuel — that’s very helpful. As a foreign buyer who purchased property in 2025, I’m also wondering if the current 4% MOT rate would still apply when the transfer is only perfected after 2025. From what you explained, it seems earlier transactions shouldn’t be affected unless the new rate is made retrospective. Hopefully, the Finance Ministry or LHDN can provide clear guidance soon so that foreign buyers completing purchases near the end of 2025 aren’t caught by surprise.
Hi Samuel, wondering if you have any updates on whether the new 2026 8% foreigner property stamp duties apply to property purchased and paid in full in 2023 but strata title is being processed pending approval by the government. Thank you!
Hi Rick, thanks for your question. Based on what has been announced under Belanjawan MADANI 2026, the higher stamp duty rate for foreign buyers is a new measure and will only apply once the relevant law is gazetted and comes into force. At this point, the government has not yet shared detailed guidelines on how this will apply to past purchases where the strata title is still pending. In general, stamp duty is usually based on the date the Sale and Purchase Agreement or transfer document is signed, not when the strata title is issued. However, this will depend on… Read more »