What is Lelong Property?
A bank lelong property or property auction refers to a property sold through a public bidding process. In most cases, these homes are repossessed by banks or ordered for sale by courts due to unpaid loans or legal disputes.
In Malaysia, there are two primary types of auctions:
- Bank Auctions (Foreclosure Sales): When a borrower defaults on their housing loan, the bank can auction off the home to recover the outstanding balance.
- Court Auctions: Managed through the High Court or Land Office for cases involving legal enforcement or dispute resolution.
Each auction type follows specific processes and legal structures but all offer potential for buyers to acquire house lelong units at below-market value.
What is a Proclamation of Sale (POS)?
A Proclamation of Sale (POS) is prepared and published before a house lelong takes place. It serves as an official notice and provides a summary of the auction property in Malaysia that is being offered.
- Property Specifications: The type of property, address, size, and tenure are stated clearly.
- Title Information: The property’s title status (individual or strata) and relevant title numbers are disclosed.
- Reserve Price: A minimum reserve price is fixed by the bank, and this price is used as the starting point during the property lelong session.
- Auction Details: The date, time, and location (physical or online through e-Lelong) are mentioned.
- Encumbrances: Any caveats, liens, or existing loans registered on the property are declared.
- Deposit Requirement: The required deposit, typically 10% of the reserve price, is specified and must be prepared in a bank draft before bidding.
What is a Condition of Sale (COS)?
The Conditions of Sale (COS) outlines the terms and legal obligations that will apply once a house lelong bid is successfully won. This document governs what is expected from the buyer and the consequences that follow if these terms are not fulfilled.
- Payment Deadline: The balance of the purchase price (typically 90%) must be settled within a set timeframe (often within 90 or 120 days).
- Deposit Forfeiture Clause: If payment is not completed within the stipulated period, the deposit placed during the property lelong will be forfeited.
- Transfer & Legal Fees: All legal fees, stamp duties, and related costs will usually be borne by the successful bidder.
- Property Condition: All auction properties in Malaysia are sold on an “as is where is” basis, meaning no warranty is given by the seller regarding the condition of the property.
- Vacant Possession: No guarantee is given by the bank or auctioneer that vacant possession will be delivered upon completion of the sale.
Why Buy a House Lelong?
Buying a house lelong isn’t just about getting a cheaper property, it’s about strategic decision-making.
1. Competitive Prices
Auction properties are often priced 10%–40% below market value, giving you room for renovation, resale, or rental returns.
2. Access to Prime Locations
You can find rumah lelong in hot urban areas like Kuala Lumpur, Johor Bahru, or Penang — places where sub-sale prices might be unaffordable.
3. Transparent Bidding Process
Unlike private sales, auction rules are clearly defined, with published documentation, valuation details, and bidding timelines.
4. Investment Potential
For those with a renovation mindset, flipping auction properties can be highly profitable. Many seasoned investors look at property auctions in Malaysia for long-term gains.
The Risks of Auction Property
Buying auction property isn’t risk-free. While the savings can be significant, it's important to understand the challenges involved:
- No Internal Viewing: Most auction properties can’t be inspected from the inside beforehand.
- As-Is Condition: You buy the property “as is,” including any damages or outstanding repairs.
- Unpaid Charges: You may inherit unpaid utility bills, maintenance fees, or quit rent.
- Occupied Properties: Some rumah lelong are still occupied, requiring legal action to evict.
- Non-Refundable Deposit: If you win a bid but fail to settle the balance, you lose your 10% deposit.
How Property Genie Supports Your Lelong Journey
At Property Genie, we’re more than just a platform for browsing property lelong listings. We’re here to guide and empower you through every step of your lelong property journey — whether you're an experienced investor or someone looking for an affordable place to call home.
1. Curated & Verified Auction Listings
All property lelong listings on Property Genie are submitted by verified property agents. Each listing is carefully reviewed to ensure accuracy, completeness, and legitimacy, so you can browse with peace of mind and bid with confidence.
2. Legal Document Summaries
Understanding auction documents can be overwhelming. We provide clear summaries of Proclamation of Sale (POS) and Conditions of Sale (COS) so you know what you're bidding on including property status, reserve price, and more.
3. Loan & Price Estimation Tools
Property Genie offers practical tools like loan calculators to help you plan your budget with confidence. Estimate your financing eligibility, monthly repayments, and other important costs including deposits, legal fees, and stamp duties before you commit to any house lelong purchase.
4. Expert Insights & Market Tips
Stay informed with up-to-date content on property auction trends, and professional advice to help you make smart, confident decisions in the house lelong market.
Resources on where to find auction property deals:
Lelong Property Kuala Lumpur
Auction Property in Kuala Lumpur
Lelong Property in Selangor
Auction Property in Selangor
Lelong Property in KL
Auction Property in KL
Lelong Property in Johor Bahru
Auction Property in Johor Bahru
Lelong Property in Penang
Auction Property in Penang
Lelong Property Klang
Auction Property in Klang
