# Housing Development Act (HDA) Account Protection

What Is It

The Housing Development (Control and Licensing) Act (HDA) is Malaysia's primary legislation protecting residential property buyers from fraudulent or incomplete housing projects. A key feature is the mandatory HDA Account, which acts as a secure escrow account where developer funds are regulated.

Who Is Eligible

  • All homebuyers purchasing new-launch residential properties from licensed housing developers in Malaysia.
  • Note: Commercial properties (offices, retail, industrial) and SOHO/SOFO units without residential status are not protected under the HDA.

    • Required Documents

  • Signed Standard Sale and Purchase Agreement (Schedule G for landed properties, Schedule H for strata/high-rise properties).
  • Home loan offer letter and disbursement records.

    • Step-by-Step Procedure

    1. Verify Developer License: Ensure the developer has a valid Advertising Permit and Developer's License (APDL) from KPKT. 2. Execute HDA SPA: Sign the mandatory Schedule G or Schedule H SPA. Developers are legally prohibited from altering this standard template. 3. Funds Deposited to HDA: All buyer progressive payments and bank loan disbursements must be deposited directly into the project's HDA account. 4. Monitored Withdrawals: The developer can only withdraw funds from the HDA account for specific project-related costs (land acquisition, construction, taxes) validated by an independent architect. 5. Defect Liability Period (DLP): Upon handover, 5% of the purchase price is retained in the HDA account for 24 months to cover any defect repairs.

    Cost & Processing Time

  • Cost: Free protection provided by law.
  • Processing Time: Protection is active automatically from the signing date of the SPA until the expiry of the 24-month Defect Liability Period.

    • Where to Apply

  • Managed by: National Housing Department under the Ministry of Housing and Local Government (KPKT).
  • Website: [KPKT Portal](https://www.kpkt.gov.my)

    • Important Notes

  • If a developer fails to repair defects within 30 days of notification during the DLP, the buyer can claim repair costs directly from the retained 5% funds in the HDA escrow account.