Landed property owners beware
The proposed Urban Renewal Act (URA) Bill 2025, recently tabled in Parliament, threatens to fundamentally reshape Malaysia’s property landscape.
While initial public discourse suggested the Bill primarily targeted ageing strata developments, a closer examination reveals a much broader scope.
The Bill’s reach extends to landed residential homes, business premises and commercial properties – irrespective of whether they hold freehold or leasehold status.
Property experts and the National House Buyers Association (HBA) warn that the Bill’s broad powers, including majority-consent mechanisms and compulsory acquisition, could endanger individual landowners’ rights, leading to displacement and the erasure of heritage neighbourhoods.
Many homeowners assume the URA Bill only affects dilapidated high-rise buildings. This is a significant misconception.
The Bill’s definition of an Urban Renewal Area is area-based, not property-type-based.
This means any designated zone can include landed terrace houses, semi-detached homes, bungalows and traditional shophouses.
Across Peninsular Malaysia, thousands of mature neighbourhoods in Petaling Jaya, Ampang, Georgetown and Johor Bahru now fall into the over 30 years old category. Under the proposed legislation:
> Redevelopment can proceed with as little as 75% to 80% consent from owners.
> The remaining minority can be compelled to vacate through the Land Acquisition Act 1960.
> Compensation may take the form of cash or a replacement property – meaning a lifelong landed homeowner could be forced to accept a high-rise condominium unit in return.
Pertinent interpretations and concerns
The URA Bill introduces a majoritarian approach that is unprecedented in Malaysian land law.
Historically, the National Land Code has protected the indefeasibility of title – the principle that once your name is on the land title, your ownership is secure.
However, Section 19(b) of the Bill introduces a sliding scale for consent, that is, an 80% consent for buildings 30 years old or less and a 75% consent for buildings older than 30 years.
Critics argue this mechanism violates Articles 8 and 13 of the Federal Constitution, which guarantee the right to own property and protect citizens from being deprived of their land without adequate compensation.
By allowing a majority of 75% to vote away the rights of the remaining 25%, the Bill facilitates the commercial interests of developers at the expense of private homeowners.
The definition of an interested person in the Bill is also alarmingly wide, including developers and trustees. This gives profit-driven entities the power to dictate how private property should be handled, potentially manipulating renewal zones to hit consent thresholds more easily.
The mystical 30-year benchmark
One of the most contentious points of the Bill is the 30-year trigger point. The Ministry has previously acknowledged that the average lifespan of a reinforced concrete structure is between 70 and 80 years.
Even the standard housing loan in Malaysia lasts 35 years.
Why, then, does the URA Bill set the benchmark at 30 years?
At this age, many homeowners have not even finished paying off their mortgages. Critics suggest that the 30-year mark is arbitrarily short and serves the interests of rapid redevelopment rather than genuine structural necessity.
As many have pointed out, it is often the maintenance culture –not the building itself – that needs renewal.
Calculation ambiguities
The Bill remains vague on how the consent threshold is calculated. It is unclear if the vote is based on:
> One unit, one vote?
> Total land area owned?
> Strata share units?
Without clarity, landed homeowners are left in the dark about how much weight their refusal to sell actually carries.
There is a palpable fear that valuation manipulation or market distortions could leave displaced owners significantly short-changed, unable to afford a similar lifestyle in the same area.
Calls for immediate safeguards
Civic groups, Residents’ Associations and the HBA are urging lawmakers to amend the URA Bill before it passes. They are proposing five critical protections:
> Unanimous consent (100%): Any redevelopment involving the stripping of private titles must require the agreement of all owners.
> Explicit exclusion: Single-title landed homes should be explicitly excluded from forced urban renewal zones.
> Like-for-like replacement: Where owners voluntarily participate, they must be guaranteed a similar property type (landed for landed).
> Independent future-value valuation: Compensation must be based on the future potential value of the redeveloped site, not current market rates.
> The right to remain: Owners should have the right to opt out of relocation if they choose.
HBA is also calling for mandatory state-level public hearings before any area is designated for renewal, ensuring developers cannot misuse the legislation behind closed doors.
Five critical risks for landed owners
1. Universal application: The Bill applies to all property types – residential, business or industrial.
2. The age trigger: Your 30-year-old home may be labelled underutilised to justify a takeover.
3. The 75% threshold: Once three-quarters of your neighbours agree, your property rights may be effectively terminated.
4. Loss of landed status: You are not guaranteed a landed replacement; you may be forced into a condominium.
5. Community erasure: Mature, low-density neighbourhoods risk being replaced by high-density commercial blocks.
Landed-home owners in Malaysia can no longer assume they are immune to redevelopment pressures just because they own the ground their house sits on.
If the URA Bill passes in its current form, the very nature of landed living will be altered forever.
This is not merely about urban renewal. For many, it represents a forced surrender of their most valuable asset.
Homeowners must act with urgency – speak to local representatives, monitor parliamentary updates and push for stronger legal protections.
Progress in our cities must be balanced with the protection of the people who live in them. Don’t wait until the bulldozers arrive to realise that your indefeasible title has been legislated away.