Malaysian condos and apartments charge owners two recurring amounts on top of the purchase price and any mortgage installment: a maintenance fee and a sinking fund. The two usually appear together on the same payment notice, but they serve different purposes, and the per-square-foot rate quoted at the point of sale does not guarantee that your future costs will stay the same. This article covers strata properties in Peninsular Malaysia and Labuan, which fall under the Strata Management Act 2013. Sabah and Sarawak run their own separate systems and are not covered here.
Maintenance Fees Cover Daily Running Costs; the Sinking Fund Is for Bigger Work
The maintenance fee (sometimes called maintenance charges) mainly pays for the day-to-day management and upkeep of common areas: security, cleaning, shared utilities, equipment servicing, management administration, and related insurance.
The sinking fund is reserved for capital expenditure instead, such as replacing common facilities or equipment, repainting, and other qualifying large-scale works. It is not a fund for an owner’s own unit renovations, and it is not a deposit that gets refunded when a tenancy ends.
The two amounts are held in separate accounts for separate purposes. When judging whether a building is well managed, look beyond the fee amount itself to the accounts, outstanding arrears, the condition of the equipment, and planned future works.
Your Share Is Set by Share Units, Not Just Floor Area
Cost-sharing in a strata property is tied to share units. Depending on the management stage, this may be calculated on allocated share units or on the share units from the formal strata title registration.
Sales materials that convert the fee into a “per-square-foot” figure can help with a rough first estimate, but units of similar size do not necessarily carry identical share units. Accessory land parcels, the unit’s use, and the share-unit calculation method that applies can also affect the allocation.
Buyers should obtain their own unit’s share-unit information, the current rate, and the latest payment notice, and check whether the quoted figure already includes the sinking fund. If a mixed-use project charges different rates, confirm which management body set them, under what legal basis, and through what procedure – don’t assume “commercial units simply cost more” without checking.
The 10% Sinking Fund Rate Applies to the Maintenance Fee, Not a Fixed Sum
The Act sets sinking-fund contribution requirements that differ by management stage. During the developer management stage, the contribution is generally 10% of the maintenance fee. Once a Joint Management Body (JMB) or Management Corporation (MC) takes over, a general meeting can resolve to set a higher rate; 10% should not be treated as a permanent ceiling.
For example, if a unit’s monthly maintenance fee is RM300 and the applicable sinking fund contribution is 10% of that fee, the owner pays an additional RM30, for a total of RM330. This is an illustration of the calculation only – it does not mean every condo charges the same amount or uses the same ratio.
What to Compare Beyond the Monthly Rate
| What to Check | What It Tells You |
|---|---|
| Latest payment notice | Whether the maintenance fee, sinking fund, and other charges are itemized separately |
| Annual budget and accounts | Whether the charges are enough to cover daily expenses, or running a long-term deficit |
| Arrears and collection record | Whether the building collects amounts owed on time |
| Equipment and works records | Whether lifts, water pumps, the facade, and similar items have maintenance and replacement plans |
| General meeting minutes | Whether any fee increase, works, or other owner-borne cost has already been approved |
A lower charge can mean fewer facilities or well-controlled spending, but it can also mean maintenance is simply being deferred. A higher charge likewise does not guarantee better management – the services and accounts still need to be checked.
Vacant or Rented Out, the Charges Still Apply
An unoccupied unit is not automatically exempt from the maintenance fee and sinking fund that are legally due. Common facilities still need to be maintained, and charges are not based on how often any individual owner actually uses them.
If a tenancy agreement assigns certain charges to the tenant, that is an arrangement between the owner and the tenant; it does not remove the owner’s own statutory payment obligation to the management body. Owners should still check their account regularly, rather than discovering accumulated arrears only after a tenancy ends.
When buying a resold unit, have a lawyer verify outstanding arrears, how charges are apportioned at the handover date, and any amount the seller still needs to settle – a single old receipt from the seller is not enough to rely on.
Common Misunderstandings
“I Already Paid the Sinking Fund Once, So I Won’t Need to Pay It Again”
The sinking fund is normally a recurring contribution, not a one-time move-in fee. The actual amount and frequency should be checked against the current official notice.
“I Don’t Use the Pool or Gym, So I Can Pay a Lower Maintenance Fee”
Charges for common areas are calculated under the applicable apportionment rules, and are not usually based on whether an individual owner uses a given facility.
“My Tenant Agreed to Pay, So Arrears Are Not My Problem”
An arrangement inside a tenancy agreement cannot substitute for the owner’s responsibility to the management body; owners still need to confirm the charges have actually been paid.
What to Do Next
If you are considering buying, start by requesting the latest payment notice, the unit’s share-unit information, and recent general meeting minutes, then factor the maintenance fee and sinking fund into your full annual holding cost.
If you already own a unit, keep an eye on the annual accounts and any planned major works in addition to each payment. If a charge changes, check the effective date, the basis for the calculation, and the approval process behind it.
Disclaimer
This article is general information about strata property management and is not legal advice. Actual charges should be verified against the law that applies to the property, its share units, any effective resolutions, and official notices. Information verified as of October 6, 2026.
Frequently Asked Questions
Is the Maintenance Fee Always Based on Floor Area?
Not necessarily. Don’t rely only on a per-square-foot quote. Check the applicable share units, the current rate, and the formal payment notice to confirm what your own unit is actually charged.
Is the Sinking Fund Always 10% of the Maintenance Fee?
10% is an important benchmark under the Act, but once a JMB or MC takes over, there is a procedure for resolving a higher contribution rate. Not every project is permanently limited to 10%.
Do Vacant Units Still Have to Pay?
Generally yes. The maintenance fee and sinking fund that are legally due still apply; being vacant is not by itself a reason for exemption.
Have a question about this guide? Leave a comment below, or ask Zagdim directly.
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