How Does Property Auction Work in Malaysia?

Property Auction is a public sale to get a property sold to highest bidder. While property auction is a buying and selling process. In Malaysia, auction properties are always associated with foreclosure properties.

There can be several reasons why a property is foreclosed and put up for public auction. A most common reason is because the owner has failed to meet the mortgage repayment to the bank.

When the owner defaulted their mortgage repayment, the bank will repossess the property, and put it up for auction to recover the outstanding loan sum.


There are two types of property auction in Malaysia

  • Property held under master title where the individual document of title or strata title is yet to be issued. For this category of property, the auction will be done by bank under the power of attorney, and deed of assignment via private auctioneer.
  • Property held under individual document of title or strata title. For this category of property, the auction is carried out by high court or land administration.


For if you have interest to bid for a property under auction sales. You must do your due diligence on the property you intend to bid before the auction day. Below are list of items you should investigate further before bidding.

  • Get a Proclamation of Sale (POS) from auctioneer. POS will provide you with relevant details of the property you intend to bid for.
  • Do a title search. Title will provide you with information of the property including restriction, tenure, and land size. Most importantly, you will be able to check if there is any caveat being lodge against the said property. You may want to avoid bidding for a property under private caveat as you won’t be able to get any financing to purchase the property until the caveat is removed.
  • Check all outgoing bills payment for the possibilities of any unpaid sum. Bear in mind that once you successfully bid for the property in auction. It is your duty as new owner to settle all the overdue payment of outgoing, such as assessment, quit rent, utilities bills, maintenance fee and sinking fund.
  • Inspect the Property and its Surrounding. You are advice to inspect the property and surrounding neighbourhood before go to the auction hall. The interior of the property is usually inaccessible, but you still can inspect the exterior of it. Nothing beats exploring the property and its surroundings in person.


There are two ways you can bid for a property during auction day: offline, and online.

  • Offline Auction

You present yourself at the auction hall set by private auctioneer, or High Court at a pre-determined time and date. Offline bidding is the most common form of auction process.

Bidder usually needs to register and submit a deposit in banker’s cheque or bank draft to the auctioneer prior to bidding. No personal cheque or cash will be entertained. Never forget to bring your personal identity card too!

You need to submit 10% of the reserve price as deposit to the auctioneer. If the final auction price is higher than the reserve price, you will need to top up the difference of the 10% deposit.

  • Online Auction

Due to advancement of technology and Internet, nowadays you can also bid for auction property via online platform.

Steps to bid online:

  • First you will have to register at the online auction portal
  • Once your registration approved, you will be able to browse the details of properties that are up for auction online
  • Choose the property you intend to bid carefully
  • Register as bidder and pay the required deposit
  • Login to the online auction system at least 10-15 minutes before the auction time (make sure your internet connection is strong without interruption)
  • Start bidding


  • You are required to sign the Proclamation of Sale (POS) same day as the auction take place.
  • Read the POS carefully as the terms & conditions of sale are all written in there.
  • Usually you will be given 120 days to settle the balance of 90% payment. However, in some circumstances, you may only be given 90 days to make the balance payment. Failing to meet the deadline of full payment within the pre-determined timeframe will most likely result in forfeiture of your 10% deposit.


Upon full settlement of the auction price, you will receive a transfer of ownership into your name. However, it is not bank, High Court, nor private auctioneer duty to deliver your property with vacant possession. You are required to take possession of the property on your own.


Auction is widely recognised as the fastest channel to sell off distressed properties. For property investors or those who buy for own stay, auction is definitely a platform that you can potentially buy a property at bargain price, because each time that a property fail to secure a bidder, the reserve price will be reduced by 10% when next auction for the same property take place. However, you have to be aware that auction properties are sold at as it where is basis. Do a proper due diligence before stepping into the bidding hall.

Contributed by: KC Chan

For further details please email kangchung.c@hartamas.com

[Image source: Image by kjpargeter]

Loan Eligibility Calculator

How much housing loan you can get?


How much is your property worth?

new house

Interested in new launch property?

Looking for property for sale or rent?

Subscribe to our email newsletter today to receive updates on the latest news, property guides, new launches, featured secondary market properties and special offers.​
Share this article on