Hidden Costs When Buying a Property
The costs first-time buyers most often leave out of their budget, from disbursements and registration fees to utility deposits and maintenance charges.
Updated 21 August 2026 · Written and reviewed by Nur Nabilah Binti Mohd Aris
Beyond the deposit, legal fees and stamp duty, a buyer needs funds for disbursements, land office registration fees, 8% service tax, utility deposits, maintenance charges for strata property, and apportionment of quit rent and assessment. Together these can run to several thousand ringgit outside the original estimate.
Most buyers plan for the deposit and the legal fees. What gets missed are the smaller costs, which are numerous, and which add up to several thousand ringgit.
Disbursements
These are actual costs paid out on your behalf, separate from legal fees. They include official land searches, a bankruptcy search on the seller, land office fees for registering the transfer and the charge, delivery of documents, printing and copies.
As a reference, the land office fee for registering a transfer in Selangor is RM400 and for registering a charge RM100. Total disbursements are usually between RM800 and RM1,500 for an ordinary residential transaction.
Service tax
Service tax of 8% applies to legal fees since 1 March 2024. For a transaction with combined legal fees of RM12,000, that is an additional RM960.
Costs at handover
For strata property, maintenance charges and a contribution to the sinking fund normally have to be settled before keys are handed over. Utility deposits for electricity and water also need to be provided.
Quit rent and assessment are apportioned at the handover date. If the seller has paid for a period extending past handover, the buyer reimburses their share.
Costs after moving in
For a subsale property, renovation, cleaning and changing the locks are things rarely included in the initial budget. They are not legal costs, but they are part of the real cost of moving in.
Frequently asked questions
What is the difference between legal fees and disbursements?
Legal fees are the charge for legal work, fixed by statute. Disbursements are actual costs paid out on your behalf, such as official searches and registration fees.
How much are utility deposits?
They vary by utility provider and property type. For strata property, deposits and maintenance charges normally have to be settled before keys are handed over.
What is apportionment of quit rent and assessment?
Quit rent and assessment are paid for a period. At handover they are apportioned so the seller bears their share and the buyer bears the balance.
When are all these payable?
Most legal fees and stamp duty are paid early, after the sale and purchase agreement. Utility deposits and maintenance charges are normally due at handover.
Can these costs be included in the loan?
Some banks allow additional financing for legal fees and stamp duty. It depends on the approved margin and the bank's policy.
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