From SPA to Keys: Progress Billing, LAD for Late Delivery & Extension of Time
LAD for late delivery in Malaysia is 10% a year of the SPA purchase price, accrued daily, and since the Federal Court’s 2021 PJD Regency decision the delivery clock starts on the day you paid the booking fee, not the SPA date. This guide covers what happens between signing and collecting keys: progress bills, how the bank disburses, what interest you pay while the building goes up, how to calculate LAD, where the extension-of-time (EOT) case law stands, and what to do when the developer runs late.
Short answer
LAD for late delivery in Malaysia is 10% a year of the SPA purchase price, accrued daily: price x 10% x days late / 365. A developer has 24 months for landed homes and 36 months for strata units, and since PJD Regency (Federal Court, 19 January 2021) the clock starts on the booking-fee date. A RM600,000 condo 171 days late earns about RM28,110.
Key numbers at a glance
| Delivery deadline, landed (Schedule G) | 24 months, clause 24(1) |
|---|---|
| Delivery deadline, strata (Schedule H) | 36 months, clause 25(1) |
| LAD rate | 10% a year of the SPA price, day to day |
| Formula | Price x 10% x days late / 365 |
| When the clock starts | The booking-fee date (PJD Regency, 19 Jan 2021) |
| Late common facilities (strata) | A separate 10% a year on the last 20% of the price |
| Deemed vacant possession | 30 days after the VP notice is served |
| Where to claim | Homebuyer tribunal: RM50,000 cap, RM10 fee, 12 months from CCC |
Key points in 30 seconds
- For HDA-regulated homes the developer must deliver vacant possession within 24 months (landed, Schedule G) or 36 months (strata, Schedule H), or pay LAD of 10% a year of the price, day by day.
- Under PJD Regency (Federal Court, 19 Jan 2021), the delivery period and LAD run from the booking-fee date and are calculated on the SPA price.
- During construction you pay interest only on what the bank has disbursed: on a RM450,000 loan at an assumed 4%, that is about RM1,375 a month by the VP stage.
- Ang Ming Lee (26 Nov 2019) held the Controller cannot grant EOTs; Obata-Ambak (July 2024) made that ruling prospective, so earlier EOTs still stand.
- The Tribunal for Homebuyer Claims hears LAD claims up to RM50,000 for a RM10 fee, filed within 12 months of the CCC.
How long does a developer have to deliver?
If you buy a home from a licensed developer under the Housing Development (Control and Licensing) Act 1966 (the HDA, Act 118), your SPA is a statutory form. Landed homes use Schedule G, strata units (condos, serviced apartments) use Schedule H, and build-then-sell projects use Schedules I and J. The date that matters most is the deadline for delivering vacant possession (VP). For a clause-by-clause walk-through, see Schedule G, H, I & J explained.
| Item | Landed (Schedule G) | Strata (Schedule H) |
|---|---|---|
| Delivery deadline | 24 months from the SPA date (cl. 24(1)) | 36 months from the SPA date (cl. 25(1)) |
| LAD for late VP | 10% a year of the purchase price, day to day (cl. 24(2)) | 10% a year of the purchase price, day to day (cl. 25(2)) |
| Late common facilities | No separate clause | 10% a year of the last 20% of the price (cl. 29(2)) |
| Buyer may deduct LAD from instalments | Yes (cl. 24(3)) | Yes (cl. 25(3)) |
| Deemed VP after notice | 30 days after the notice is served (cl. 26(3)) | 30 days after the notice is served (cl. 27(3)) |
The forms say “from the date of this Agreement”, but in PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah & Anor (19 January 2021) the Federal Court held that where a booking fee was paid, time runs from the booking-fee payment date. Keep that receipt: it is the starting line for your LAD. The legal status of booking fees themselves is covered in booking a new property.
Progress billing: who pays, and by when?
Each time a construction stage is finished, the developer issues a progress bill supported by a certificate signed by its architect (Schedule G, cl. 5(2)). Under the statutory payment schedule you must pay within 30 days of receiving the written notice. Pay late and the developer can charge late-payment interest at 10% a year, calculated daily (cl. 10(1)).
- The bill arrivesCheck that the stage named matches the Third Schedule of your SPA and that the architect’s certificate is attached.
- Forward it to your bankSend it to the bank or its panel lawyer straight away. The first 10% is normally your own money, paid when you signed; the bank pays later stages up to your approved loan.
- The bank pays the developerNew-property loans are disbursed progressively and paid direct to the developer. Interest on each tranche starts from disbursement.
- Watch the 30-day windowBanks need processing time. A bill left in a drawer for two weeks can mean late interest charged to you.
- File everythingBills, certificates and disbursement notices are your evidence if you later claim LAD.
The full stage-by-stage percentages (foundation 10%, structure 15%, VP 17.5% and so on) and the differences between the current and pre-2015 tables are in progressive payment schedule. How the loan itself moves from approval to disbursement is in home loan application process.
On the RM600,000 example: counted from the booking fee, the unit is 171 days late and LAD is RM28,109.59. Counted from the SPA date it is 135 days and RM22,191.78, a gap of about RM5,918 on the same unit. The more common version of this loss is a booking receipt nobody kept, leaving the tribunal no choice but the SPA date. Keep that receipt with the SPA and every bill.
Ask Louis directly
Send me your booking receipt, the first page of the SPA and the VP notice and I will work out how many days late you actually are and roughly what the LAD comes to.
Give me the booking date, the SPA price and the actual handover date and I will send you a free one-page LAD calculation you can put in front of the developer or attach to a tribunal form.
How much interest do you pay during construction?
During construction you pay interest only, and only on the amount the bank has released so far. Here is an illustration: a RM500,000 strata unit, 90% loan (RM450,000), with the buyer paying 10% (RM50,000) at signing. I have assumed a 4% annual rate purely for the arithmetic; it is not any bank’s quote. Rates are explained in OPR, SBR and home loan rates.
| Stage completed | Stage amount (RM) | Cumulative disbursed (RM) | Approx. monthly interest (RM) |
|---|---|---|---|
| Foundation (10%) | 50,000 | 50,000 | 166.67 |
| Structural frame (15%) | 75,000 | 125,000 | 416.67 |
| Walls, door & window frames (10%) | 50,000 | 175,000 | 583.33 |
| Ceiling, wiring, plumbing (10%) | 50,000 | 225,000 | 750.00 |
| Internal & external finishes (10%) | 50,000 | 275,000 | 916.67 |
| Sewerage (5%) | 25,000 | 300,000 | 1,000.00 |
| Drains (2.5%) | 12,500 | 312,500 | 1,041.67 |
| Roads (2.5%) | 12,500 | 325,000 | 1,083.33 |
| Vacant possession (17.5%) | 87,500 | 412,500 | 1,375.00 |
Monthly interest ≈ cumulative disbursement × 4% ÷ 12. The remaining RM37,500 (2.5% on delivery of title and two 2.5% stakeholder sums) is released after VP. Once the loan is fully or mostly drawn, the bank will move you to full principal-plus-interest instalments.
How is LAD for late delivery calculated? A worked RM600k example
The formula is SPA price × 10% × days late ÷ 365. PJD Regency also confirmed that LAD is based on the purchase price stated in the SPA. Strata buyers have a second, separate claim if the common facilities are late: 10% a year on the last 20% of the price.
| Item | Date / figure |
|---|---|
| Booking fee paid | 10 January 2022 |
| SPA signed | 15 February 2022 |
| 36-month deadline (from booking fee) | 10 January 2025 |
| 36-month deadline (if counted from SPA) | 15 February 2025 |
| Actual VP | 30 June 2025 |
| Common facilities completed | 30 September 2025 |
- Unit LAD, counted from the booking fee: 171 days late. RM600,000 × 10% × 171 ÷ 365 = RM28,109.59 (about RM164.38 a day).
- If wrongly counted from the SPA date: 135 days late, LAD = RM22,191.78. The gap of roughly RM5,918 is what PJD Regency is worth to this buyer.
- Common facilities LAD: the last 20% of the price is RM120,000; 263 days late (10 Jan to 30 Sep 2025). RM120,000 × 10% × 263 ÷ 365 = RM8,646.58.
- Total: about RM36,756, within the tribunal’s RM50,000 limit.
Days are calendar days; lawyers sometimes differ by one day on where the count starts, which changes little. For SPAs signed before 18 March 2020, the COVID-19 Act (Act 829) excludes 18 March to 31 August 2020 from both the delivery period and the LAD calculation, and allowed the Minister to extend that to 31 December 2020.
Common LAD disputes: what developers say
| Developer says | The position |
|---|---|
| “LAD is on the net price after rebates” | PJD Regency confirmed it is based on the purchase price stated in the SPA. |
| “The clock started at the SPA” | Where a booking fee was paid, it runs from the booking-fee date (PJD Regency). |
| “You didn’t collect the keys, so it’s your delay” | Thirty days after the VP notice is served you are deemed to have taken VP and LAD stops there; delaying collection can’t keep LAD running. |
| “You paid late, so we’ll set it off” | If you paid late the developer can charge 10% a year late interest and the two can be set off, so keep your payment records complete. |
| “Common facilities don’t count” | Strata projects (Schedule H) carry a separate LAD for late common facilities: 10% a year on the last 20% of the price. |
Can a developer get an extension of time (EOT)?
An extension of time is the developer’s main tool for cutting LAD. The courts have shifted position several times since 2019:
| Case | Court & date | What it decided |
|---|---|---|
| Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan & Anor | Federal Court, 26 Nov 2019 | Reg 11(3) of the 1989 Regulations is ultra vires; the Controller of Housing has no power to extend time or waive the statutory contract. |
| Bludream City Development Sdn Bhd v Kong Thye & Ors | Court of Appeal, 2022; Federal Court refused the buyers leave to appeal on 4 Jan 2023 | The Minister can grant an EOT under s.24(2)(e) HDA. Whether buyers must be heard first remains unsettled. |
| Obata-Ambak Holdings Sdn Bhd v Prema Bonanza Sdn Bhd | Federal Court, July 2024 | Ang Ming Lee applies prospectively only: EOTs granted before 26 Nov 2019 stand. |
In practice: an EOT granted by the Controller before 26 November 2019 will generally hold; one granted by the Controller after that date is open to challenge; one granted by the Minister is valid on the Bludream reasoning. If your developer says it has an extension, ask for the approval letter, who signed it (Controller or Minister) and the date, and give it to a lawyer.
Mind the limitation clock. Two law firms (Azmi & Associates and Chee Hoe & Associates) read Obata-Ambak as holding that the six-year limitation period under s.6(1)(a) of the Limitation Act 1953 runs from the date the SPA was signed, not from the delivery deadline. Other guides, such as iProperty’s, describe it as six years from the breach. Both readings are printed here; the safe course is not to wait.
What to do if the developer delivers late
- Work out your deadlineAdd 24 or 36 months to your booking-fee date. Put the SPA, booking receipt and every bill in one folder.
- Check the VP noticeWhen the notice arrives, confirm there is a CCC, water and electricity are ready for connection and, for strata, the strata title has been issued. See CCC and vacant possession.
- Demand LAD in writingAfter VP, write to the developer with your calculation. Many developers offset LAD against the final amounts or pay it separately; get the figure confirmed in writing.
- Deduct it if you mustThe statutory SPA lets you deduct LAD from instalments due (Sch G cl. 24(3) / Sch H cl. 25(3)). Have a lawyer confirm the figure first so you are not hit with late-payment interest.
- File at the tribunalIf the developer ignores you, file Form 1 with the Tribunal for Homebuyer Claims within 12 months of the CCC: limit RM50,000, fee RM10. See how to claim at the homebuyer tribunal.
- Larger claims or missed deadlineAsk a lawyer about a civil suit and keep the six-year limitation point above in mind.
If the site has gone quiet for months, the problem may be bigger than lateness. For projects where work has stopped for six months or more, read abandoned housing projects.
How to monitor construction progress: my checklist
- Match every progress bill and architect’s certificate against the SPA’s Third Schedule before sending it to the bank.
- Visit the site (or have someone visit) every few months; take dated photos and compare them with the stages billed.
- Look the project up on the National Housing Department’s TEDUH portal and check the developer’s licence — see checking the KPKT register and how to check a developer.
- Several months with no new bill and a quiet site is a warning sign.
- Join the buyers’ group, but rely on official documents, not rumours.
- Never sign a side letter trading away LAD for a “goodwill package” without a lawyer reading it first.
- Keep the booking receipt, SPA, bills, bank letters and VP notice until well after the defect liability period ends.
Related questions
Can the developer set my own late payments off against LAD?
Yes. The statutory contract lets the developer charge late-payment interest at the same 10% a year, calculated daily, and the two amounts can be set off against each other. So before you claim, put your payment record in order: every bill, architect’s certificate, bank disbursement advice and payment date. Buyers usually lose this argument for lack of proof that the bank in fact paid on time, not because they were genuinely late.
Is a goodwill package worth accepting instead of LAD?
Work out the number first. A RM600,000 condo delivered 171 days late earns RM28,109.59, and on a strata project late common facilities add a separate claim (10% a year on the last 20% of the price, RM8,646.58 for 263 days). Furniture, a few months of service charge or a discount rarely comes close. Either way, do not sign a side letter before a lawyer reads it: one line waiving all claims is enough to end the argument.
Do the MCO months count as the developer's delay?
For an SPA signed before 18 March 2020, the COVID-19 Act (Act 829) excludes 18 March to 31 August 2020 from both the delivery period and the LAD calculation, and the Minister was empowered to extend that exclusion to 31 December 2020. Those months are neither late delivery nor accruing damages. Contracts signed after 18 March 2020 are not covered. Ask your lawyer to confirm in writing which side of that date your SPA falls on.
It has been more than a year since handover. Am I too late?
The tribunal route has a hard deadline: 12 months from the date the Certificate of Completion and Compliance was issued. After that only a civil suit remains, and the six-year limitation period is itself disputed. Two firms read Obata-Ambak as running it from the SPA date, while other guides describe it as six years from the breach. Both readings are printed on this site; the safe course is not to wait. Filing steps are in the homebuyer tribunal guide.
Frequently asked questions
How do I calculate LAD for late delivery in Malaysia?
Multiply the SPA purchase price by 10%, then by the number of days late, and divide by 365. A RM600,000 condo delivered 171 days late earns about RM28,110. For strata projects, late common facilities attract a separate LAD of 10% a year on the last 20% of the price.
Does LAD start from the SPA date or the booking fee date?
From the booking fee date. In PJD Regency (19 January 2021) the Federal Court held that for HDA housing projects the delivery period and LAD run from the date the booking fee was paid, and LAD is based on the price stated in the SPA. Keep your booking receipt.
Can I still claim LAD if the developer got an extension of time?
It depends who granted it and when. Controller EOTs granted before 26 November 2019 remain valid (Obata-Ambak, 2024). After that date the Controller has no power (Ang Ming Lee, 2019). A Minister’s EOT is valid under Bludream City (Court of Appeal, 2022). Ask for the approval letter and let a lawyer assess it.
Do I pay my home loan while the property is under construction?
Yes, but only interest on the amount disbursed so far. The bank pays the developer stage by stage and your interest grows with each release. At RM412,500 disbursed and an assumed 4% rate, that is about RM1,375 a month. Full principal-and-interest instalments usually begin after VP.
How many days do I have to pay a progress bill?
Under the statutory SPA, within 30 days of receiving the developer’s written notice, which must be supported by an architect’s certificate. Late payment lets the developer charge interest at 10% a year, calculated daily, so if you have a loan, forward each bill to your bank as soon as it arrives.
What if my LAD claim is more than RM50,000?
The Tribunal for Homebuyer Claims caps awards at RM50,000 unless both sides agree in writing to a higher amount. Above that, a lawyer can bring the claim in the civil courts. Watch the six-year limitation period, which some law firms read Obata-Ambak as running from the SPA date.
Sources & verification
- Schedule H (HDA statutory SPA, strata) — REHDA Melaka copy
- Schedule G (HDA statutory SPA, landed) — REHDA Melaka copy
- Mah Weng Kwai & Associates — PJD Regency: LAD from booking-fee date
- Thomas Chambers — Ang Ming Lee, Prema Bonanza and the new landscape of housing law
- Chee Hoe & Associates — Key takeaways, Obata-Ambak v Prema Bonanza (26 Jul 2024)
- Azmi & Associates — LAD claims after Obata-Ambak (limitation)
- Allen & Gledhill — Court of Appeal: Minister may grant EOT (Bludream City)
- The Edge Malaysia — The Bludream apex court decision
- Mah Weng Kwai & Associates — COVID-19 Act 2020 (Act 829) and housing
- iProperty — How to claim LAD for late delivery
- KPKT — TTPR FAQ (Soalan Lazim)
Verified: 2026-09-20. This guide is general information, not legal, tax or financial advice. Rules and rates change — confirm in writing with your lawyer, bank or the relevant authority before you sign.
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Louis Koh
11 years in Malaysian property · Johor Bahru & Kuala Lumpur · English & 中文
I help local buyers and cross-border buyers from Singapore with new and subsale property. Every figure in these guides is sourced; when a rule changes, I update the page and date it.
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Send me your situation — new or subsale, budget, state, and where you are in the process — and I will tell you what to do next and what to watch for.
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Louis Koh · 11 years in Malaysian property · +60 10-906 6685 · replies 9am–10pm MYT