IT is impossible to buy a double-story link house in most parts of the Klang Valley or in the major towns and cities in Malaysia for less than RM600,000.
For a link house costing RM600,000, the stamp duty and legal fee comes to whopping RM18,500 – RM15,000 for stamp duty and RM3,500 for legal fee.
Stamp duty is charged at one per cent for the first RM100,000, two per cent for the next RM400,000 and three per cent for the next RM1.5mil while the legal fee is charged at one per cent for the first RM100,000 and 0.5% for the next RM1.5mil.
There is hardly any difference in the work and effort involved (including documentation in standard forms for the sales and purchase agreement, memorandum of transfer etc) for the purchase of a RM100,000 house for which the legal fees (excluding stamp duty) is RM1,000 or a RM1.5mil house for which the legal fee is RM7,500.
In the United Kingdom, Australia, and New Zealand, the legal fees for house buyers has been considerably reduced by allowing licensed conveyances, besides lawyers, to do the legal work.
By adopting such a practice of allowing a wider range of practitioners to provide conveyancing (land transactions) services, legal fees for house buyers can become more competitive and thus more affordable.