Rent increases and tenancy renewal in Malaysia (2026): what the agreement allows, notice and negotiation

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By Jason Lim, REN 84424 · IQI Realty · Checked on 13 November 2026

This guide is for tenants and landlords in Johor Bahru and across Malaysia, including people from Singapore, Indonesia, India and China, whose tenancy is up for renewal. The short answer: Malaysia has had no rent control on private homes since the late 1990s, so a landlord can ask for more rent when a tenancy ends, but cannot raise it during a fixed term unless the agreement allows it or the tenant agrees. The notice, the renewal rent and how to renew all come from your tenancy agreement, read with the Contracts Act 1950.

Can a landlord raise the rent in Malaysia?

Yes, but only at the right time and in the right way. Rent control on private premises in Peninsular Malaysia ended with the Control of Rent (Repeal) Act 1997, which took effect on 1 September 1997 and phased out the old controlled tenancies by 31 December 1999. Since then, rent has simply been a term agreed between owner and tenant. On 4 August 2026 the deputy housing minister told the Dewan Negara that the government does not plan nationwide rent control, because rents depend on local market conditions (Bernama).

Because rent is a contract term, one side cannot change it alone in the middle of a fixed term. A higher rent needs either a clause in the agreement that allows a review, or the tenant’s written agreement to a variation (SAYS, May 2025). When the term ends, both sides can agree new terms, or walk away.

Your situation	Can the rent go up?	What decides the timing
Fixed term running, no review clause	Not until the term ends, unless the tenant agrees in writing	The end date in the agreement
Fixed term with a rent-review or step-up clause	Yes, but only as the clause says (for example a stated increase in year two)	The review date and notice in the clause
Tenant exercises an option to renew	Yes, if the option sets a new rent or a formula; otherwise it must be agreed	The option’s notice window
Term has ended and both carry on month to month	The landlord can propose a new rent with reasonable notice, commonly at least one rental period	Reasonable notice; the tenant can decline and leave
A new agreement after the old one ends	Yes, it is a fresh negotiation	Whatever both sides sign

On the new law: Malaysia has no residential tenancy act in force yet. In August 2026 the housing ministry said the Residential Tenancy Bill was still being finalised; my guide to the Residential Tenancy Act status tracks it.

How renewal clauses work

Most Johor Bahru tenancies run for one or two years, often written as “1+1” or “2+1”: a fixed term plus an option for one more year. Read the renewal clause before you sign, not three weeks before the end date.

The option to renew

An option to renew gives the tenant, not the landlord, the right to extend. A Malaysian Bar committee column notes that the tenant typically has to give written notice of the wish to renew, for example three months before expiry. Two traps come up again and again, as a long-running legal column in The Star has pointed out:

• Missing the window. If the tenant does not give notice within the stated time, the option is usually lost unless the landlord waives the deadline.
• No way to fix the new rent. If the clause says only that the rent “shall be mutually agreed”, and the two sides cannot agree, the right to renew may turn out to be empty. The Contracts Act 1950 (section 30) treats agreements whose meaning is not certain, and cannot be made certain, as void.

Ways to set the renewal rent

Clause type	Example wording (paraphrased)	For the tenant	For the landlord
Fixed figure	Renewal at RM2,100 a month	Certainty; easy to budget	Locked in even if the market moves
Fixed step-up	Renewal at the current rent plus a stated percentage	Predictable	Predictable; simple to apply
Capped market rent	Prevailing market rent, but not more than a stated percentage above the current rent	Protection against a large jump	Some room to follow the market
Market rent with a referee	If not agreed within 14 days, a registered valuer fixes the market rent	A fair mechanism, at some cost	A fair mechanism, at some cost
“To be mutually agreed”	Renewal at a rent both parties agree	Weak; can fail if no agreement	Flexible, but may lead to a dispute

Company lets often add a rent-review clause; see corporate tenancies.

When the term ends with nothing signed

It happens often: the end date passes, the tenant keeps paying, the landlord keeps accepting. Where there is no written agreement, a tenancy usually runs month to month, and either side can end it, or propose new terms, with reasonable notice of at least one rental period (SAYS, May 2025). That leaves both sides exposed, so put a renewal in writing.

• The landlord cannot lock the tenant out. Under section 7 of the Specific Relief Act 1950, an owner can recover a home from a tenant who stays on only through court proceedings.
• Holding over can be costly for the tenant. Under section 28(4) of the Civil Law Act 1956, a tenant who wilfully stays on after the tenancy has ended and after the landlord’s written demand and notice to give up possession can be made to pay double the rent until they leave. A tenant who gives notice to quit and then does not leave can also be charged double.
• Paying a new rent without objecting can be read as agreement. If the landlord asks for more and the tenant simply starts paying it, the landlord may later say the new rent was agreed. Confirm any change in writing either way.

A renewal timeline that avoids surprises

When	Landlord	Tenant
3 to 4 months before expiry	Check comparable asking rents in the same building and decide what you want	Read the renewal clause and note the notice deadline
Before the option deadline	Reply to any renewal notice in writing	Send written notice to renew, or to leave, by the method the agreement requires
2 months before expiry	Put the proposed rent and any changed terms in writing	Negotiate, or start looking elsewhere
Before the end date	Sign a renewal agreement or letter	Sign; top up the deposit if agreed
Within 30 days of signing	Stamp the renewal through LHDN’s e-Duti Setem on MyTax

Negotiating a rent increase fairly

There is no official rent index for Johor Bahru, so renewal talks come down to comparable asking rents, the unit’s condition and how much each side values stability. In my experience these points help:

If you are the tenant

• Bring comparables. Asking rents for the same layout and floor range in your building, and similar buildings nearby.
• Offer what landlords value. A longer term, rent paid on time, good care of the unit and no vacancy gap.
• Trade, don’t just refuse. A smaller increase in exchange for two years, or the asked rent if the owner replaces an old aircon or water heater.
• Get the outcome in writing before the old term ends.

If you are the landlord

• Price against the market, not your instalment. Your loan or maintenance fee going up does not change what tenants will pay for the unit.
• Weigh the cost of a vacancy. A modest increase with a reliable tenant often beats a higher asking rent that sits empty.
• Keep it lawful. If the tenant declines and the term ends, recover the unit through notice and, if needed, the courts. Never cut utilities or change locks.

Some academics have suggested the coming law should limit how often rents can rise (Bernama, 14 August 2026). That is a proposal, not government policy.

Paperwork when you renew

• Renewal agreement or letter. It can refer to the original terms and change only the rent, term and dates.
• Stamp duty. LHDN’s guideline of 30 June 2026 lists a tenancy renewal agreement as a lease instrument charged under Item 49, by the length of the new term.
• Deposits. Deposits are usually set as months of rent, so many agreements ask for a top-up when the rent rises. Agree it in writing; the original deposit normally carries over.
• Inventory. Update the inventory with dated photos, especially if anything has been replaced.
• Passes for foreign tenants. Check the pass covers the new term. Letting someone without a valid pass stay is an offence under section 55E of the Immigration Act 1959/63, with fines of RM5,000 to RM30,000 per person (court report, April 2024).
• Building management. Update the tenant registration if the building requires it.

Renewal term	Duty per RM250 of annual rent	Example: RM2,100 a month (RM25,200 a year)
Up to 1 year	RM1	RM101
More than 1 year, up to 3 years	RM3	RM303
More than 3 years, up to 5 years	RM5	RM505

Late stamping carries a penalty of the higher of RM50 or 10% of the duty within three months, and more after that (LHDN, May 2026). An unstamped agreement cannot be used as evidence until it is stamped, which matters if the renewal ever ends in a dispute.

If you cannot agree

Then the tenancy ends on its end date. The tenant hands back the unit as the agreement requires, and the landlord refunds the deposit less any proper deductions; see my guide to rental deposit refunds. If a tenant will not leave or stops paying, the routes are a notice of demand, then the courts, as my guide to a tenant not paying rent explains. Claims of up to RM5,000, such as a disputed deposit, can go through the small claims procedure in the Magistrates’ Court (Malay Mail, February 2025).

Tenants weighing a move can compare renting or buying in JB; foreign renters can start with renting in Johor Bahru as a foreigner.

Where to rent or buy if you are moving

• JB Sentral and Bukit Chagar: near the CIQ and the RTS Link station; rents at the higher end.
• Mount Austin: family condos and landed homes near schools and cafes.
• Tebrau, Setia Indah and Molek: established neighbourhoods with malls nearby.
• Permas Jaya and Senibong: east-side condos at moderate rents.
• Iskandar Puteri: Medini, EduCity and the Second Link.
• Skudai, Tampoi and Kempas: older areas popular with students and workers.

Compare them on my JB property map.

More Johor living guides: Landlord tenancy agreements · Residential Tenancy Act status · Rental deposit refunds · Subletting rules for tenants · Who pays for repairs

Frequently asked questions

Can my landlord increase the rent in the middle of a tenancy in Malaysia?

Not unless the agreement has a rent-review clause or you agree in writing. Rent is a contract term, so during a fixed term it stays as agreed. The landlord can propose a new rent when the term ends.

Is there rent control in Malaysia?

No. The Control of Rent Act 1966 was repealed from 1 September 1997, and in August 2026 the deputy housing minister said the government does not plan nationwide rent control. Rents are agreed between owner and tenant.

How much notice must a landlord give for a rent increase?

No law sets a notice period. Follow your agreement. If the tenancy has become month to month, reasonable notice of at least one rental period is the common expectation, and the tenant can decline and leave.

What happens if I miss the deadline to exercise my option to renew?

The option is usually lost unless the landlord agrees to waive the deadline. You can still negotiate a new tenancy, but the landlord can set new terms or let the unit to someone else.

Do I need to stamp a tenancy renewal agreement?

Yes. LHDN treats a renewal agreement as a lease instrument under Item 49. For a renewal of up to one year the duty is RM1 per RM250 of annual rent, so RM2,100 a month comes to RM101. Stamp within 30 days of signing.

Will the Residential Tenancy Act limit rent increases?

Nothing official says so. In August 2026 the housing ministry said the bill was still being finalised and that no nationwide rent control is planned. Some academics have suggested limits on how often rent can rise, but that is not policy.

Renewing a tenancy in JB?

Whether you are the landlord or the tenant, tell me the building, the unit and when the tenancy ends. I will pull current asking rents for comparable units, help you read the renewal clause and suggest terms both sides can live with. You can also book an appointment, or a Zoom consultation if you are abroad.

Sources: Control of Rent (Repeal) Act 1997 (Act 572), Laws of Malaysia text (FAOLEX copy), checked November 2026; Bernama, “Residential Tenancy Bill being finalised to balance rights of tenants and landlords”, 4 August 2026; Berita RTM, “Kerajaan muktamadkan RUU Sewaan Kediaman” (Dewan Negara reply), 4 August 2026; Bernama, “Residential Tenancy Act can strengthen protection for tenants, property owners”, 14 August 2026; SAYS, “Can your landlord raise the rent without notice in Malaysia?”, 7 May 2025; Malaysian Bar Conveyancing Practice Committee column, “Tenancy agreement”, accessed November 2026; The Star, “Rental issues” (Articles of Law column), 2 March 2004, as reproduced by the National House Buyers Association; Attorney General’s Chambers, Laws of Malaysia: Contracts Act 1950 (section 30), Specific Relief Act 1950 (section 7), Civil Law Act 1956 (section 28), Stamp Act 1949 (section 52) and Immigration Act 1959/63 (section 55E), checked November 2026; LHDN, Garis Panduan Pengenaan Duti Setem, First Schedule, Stamp Act 1949 (Item 49), 30 June 2026; LHDN, stamp duty penalties and stamping deadlines, updated 13 May 2026; Daily Express, Immigration Act section 55E case, 26 April 2024; Malay Mail, on the small claims procedure (Order 93, Rules of Court 2012), 28 February 2025

Jason Lim, REN 84424, IQI Realty Sdn. Bhd. E (1) 1584/6. General information checked on 13 November 2026, not legal advice. Your tenancy agreement decides your rights; for a disputed renewal or a clause you are unsure of, ask a Malaysian lawyer. Stamp duty rules and the status of the tenancy bill can change; check LHDN and KPKT announcements.