Renting: Landlord or Tenant, Who Actually Has More Power?

Renting: Landlord or Tenant, Who Actually Has More Power?

When I wrote the original article, I shared a story about one of my own rental properties.

A husband and wife came to view my 730 sq ft apartment.

After looking around, the husband told me:

“Most of the units I have viewed are asking RM500–RM550.”

My unit was RM650.

My response?

“Then I suggest you choose one of those units.”

They didn’t rent my unit. And honestly, I was quite happy.

Why? Because I felt we were already starting the relationship wrongly.

Then another potential tenant came. A Malaysian Indian engineer. Skinny chap but can feel his honesty.

He was from another state and had just started working in Penang. He liked the unit because it was fully furnished. He asked whether I could reduce the rental because he was just starting out.

Same request as the earlier potential tenant! I agreed. The respect was mutual. He expected an understanding landlord, I expected an honest tenant.

He eventually stayed for years. His rental was always paid on time. By the way, he drove a black colored Iswara. 🙂

Later, he progressed in his career and bought a landed property in Penang. That experience taught me something which I still believe today:

Renting is not just about how much the tenant pays or how much the landlord receives.

It is about whether both sides can live with the deal. And in 2026, I think this becomes even more important.

WHAT has changed since I wrote that article?

The biggest change is that Malaysia is moving towards having a more structured framework for residential renting. (Okay… moving slowly…)

The proposed Residential Tenancy Act (RTA) has been discussed for years, but as of May 2026, it is still in draft form and has not yet been tabled in Parliament. The objective is basically to provide clearer rights and responsibilities for both landlords and tenants. 

I think this is necessary. Because right now, many rental disputes still come down to:

“But I thought…”

The tenant thought the deposit would be returned immediately. (Yes, I can safely say, I return immediately as soon as my real estate negotiator tells me all are clear)

The landlord thought the tenant would pay for the damage.

The tenant thought the landlord would repair something.

The landlord thought the tenant would maintain it.

And then both sides get angry.

A proper agreement is supposed to prevent this.

#1 – LANDLORDS: Don’t just look at the rental

As a landlord, it is very tempting to think:

“I want RM2,000 rental.”

That’s it.

But I have become more interested in another question:

“Who is going to pay me this RM2,000 every month?”

A tenant who pays RM2,000 on time for three years may actually be much better than someone who promises RM2,200 but gives you problems.

This is why I still believe that tenant selection is extremely important.

Not because landlords should discriminate against people.

But because renting is a financial relationship.

You want someone who can afford the rental, understands the tenancy agreement and will take care of the property.

And please don’t assume that the tenant with the highest offer is automatically the best tenant.

Sometimes, the best tenant is simply the person who gives you confidence.

#2 – TENANTS: You are choosing too

I also think tenants sometimes forget this. They are not merely asking:

“Will the landlord accept me?”

They should also ask:

“Do I want this landlord?”

Before signing, ask:

Who pays for repairs?

What happens if the air-conditioner breaks?

Who maintains the appliances?

What happens if I need to leave early?

These are not uncomfortable questions.

These are normal questions.

And if the landlord becomes angry simply because you are asking about the agreement, perhaps that tells you something.

#3 – The rental deposit is real money

This sounds obvious.

But recent news shows why it matters.

In July 2026, the Johor Consumer Claims Tribunal ordered a property management and co-living company to refund RM5,400 to a former tenant.

The tenant had paid a two-month rental deposit, utility deposit and access-card deposit. He said the property was returned in good condition and the agreement stated that the deposit was refundable. (The Star) 

RM5,400 may not sound huge to some landlords.

But to a tenant moving into another home, RM5,400 can be a very significant amount.

So both sides should document everything. Take photographs when moving in. Take photographs when moving out.

Keep receipts. Keep WhatsApp messages. Keep the tenancy agreement.

And most importantly:

Don’t rely on verbal promises.

#4 – LANDLORDS now need to think about something else too

There is another issue that I think many property investors don’t pay enough attention to.

What if the tenant uses my property for something illegal?

Recent discussions around Malaysia’s proposed Residential Tenancy Act have highlighted concerns about rented properties being used for activities such as illegal cryptocurrency mining, prostitution, storing stolen goods and other unlawful activities. 

A June 2026 report also looked at when landlords could potentially be held responsible for illegal activities taking place in their properties.

The important point is that landlords should not simply hand over the keys and disappear.

Know your tenant. Have proper documentation. Include appropriate clauses in the tenancy agreement.

And if something suspicious happens, do something about it.

This is not about becoming a detective. It is about being a responsible property owner.

#5 – The tenancy agreement is becoming even more important

There is another 2026 development worth knowing about.

From 1 January 2026, Malaysia’s stamp-duty self-assessment system began covering lease and tenancy agreements as part of Phase 1.

The system requires duty payers to declare and pay stamp duty digitally through MyTax, with stronger audit powers for the tax authorities. 

There is also a 2026 voluntary disclosure programme covering eligible instruments executed between 1 January 2023 and 31 December 2025, with the penalty exemption period extended to 31 December 2026. 

For me, the lesson is simple:

Don’t treat the tenancy agreement as a piece of paper that we sign because the agent says so.

Read it. Understand it. Stamp it properly. Keep a copy.

The more money involved, the more important this becomes.

#6 – And what about rental versus buying?

This brings me back to the young engineer who rented my apartment.

He was driving a Proton Iswara which at the time meant it’s either a second-hand car or he has been driving it for some time.

He could have rented a more expensive condominium versus just an apartment?

He didn’t. He rented my unit because it made financial sense.

I estimated he was saving around RM250 a month on rental and another RM500 or so on his car compared with a more expensive lifestyle.

That’s around:

RM750 × 12 = RM9,000 a year.

Over five years:

RM45,000.

That was meaningful money for someone saving towards his first home. Sufficient for a RM450,000 property. Just from these two things. Eventually, he bought a landed property.

I thought that was smart.

He didn’t rent because he couldn’t afford to buy. He rented strategically while preparing to buy.

That’s very different.

SO, who wins?

The landlord? The tenant?

A good rental arrangement should allow both sides to win.

The landlord receives reasonable rental from a reliable tenant. The tenant gets a suitable home at a rental he can afford.

The landlord’s property is maintained. The tenant has a comfortable place to live.

The landlord gets paid on time. The tenant gets his deposit back when the agreement says he should.

Simple.

Of course, reality is not always that simple. But perhaps we can make it simpler by starting with the right attitude.

For landlords:

Don’t just look for the highest rental. Look for the right tenant.

For tenants:

Don’t just look for the cheapest rental. Look for the right home and the right landlord.

And for both sides:

Put everything important in writing.

The rental market is changing.

The proposed Residential Tenancy Act may eventually bring even clearer rules.

Stamping is becoming more structured.

Tenants are becoming more aware of their rights.

Landlords are becoming more aware of their responsibilities.

Sometimes, choosing the right tenant is actually more important than getting the highest rental.

Happy renting.

Happy investing.

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Sources

• The Star — Tribunal orders RM5,400 rental deposit refund
• The Star — Govt urged to expedite Residential Tenancy Act
• The Star — When landlords are held accountable
• The Star — Modernising Malaysia’s tax system
• The Star — LHDN extends voluntary stamp duty disclosure to Dec 31
• Original Kopiandproperty article — Renting News: The decision of whom to rent to is with the landlord