What is HDA and Why It Matters to Buyers?

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If you're buying a new home directly from a developer, the Housing Development (Control and Licensing) Act 1966 (HDA) is your best friend.

It’s a law designed to protect you (the buyer) when purchasing residential properties still under construction.

How HDA Protects You as a Buyer:

Only licensed developers can sell housing projects.

A standard Sale & Purchase Agreement (SPA) must be used — no hidden clauses or unfair terms.

You only pay according to construction stages (e.g., 10% on signing SPA, 15% upon foundation completion, etc.). You won’t pay everything upfront, which reduces risk.

If the project is abandoned, you entitled to a full refund via housing tribunals or insurance-backed guarantees. This gives greater security.

Developers must deliver the property within a set timeline (usually 36-48 months). If delayed, the buyer is entitled to LAD – Liquidated Ascertained Damages (e.g., RM10 per day for every late day).

Your money is safe — Developer can only collect a max of 10% as booking fee + deposit before SPA. All other payments must go through a stakeholder (lawyer or bank trust account).

Whether you're a first-time buyer or investor, HDA ensures your rights are protected from Day 1.