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SoHo, SoVo, and SoFo: 2 Things to Consider Before Making a Purchase in Malaysia!

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Are you confused about SoHo, SoVo, and SoFo properties and how they differ from serviced apartments, apartments, and condominiums? Let’s examine these three terms in-depth, as well as loan terms and utility tariffs, that you should know before purchasing/renting!

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We’re sure you’ve encountered terms like SoHo, SoVo, and SoFo when property hunting, especially if you are looking at prime hotspots near MRTs or next to a shopping mall. These properties are usually sold at attractive prices and feature amenities that appeal to young families and millennials.

1. How Did The Terms SoHo, SoVo, and SoFo Come About?

soho sovo sofo
Katarzyna Białasiewicz | 123rf

The government passed the Strata Titles Act in 2007 to cover stratified landed development under the Housing Development Act (Control and Licensing) (Amendment) 2007. This allowed developers to build smaller units in high-density areas, making SoHo, SoVo and SoFo units affordable.

Commercial VS Residential?

The biggest difference between SoHo, SoVo, and SoFo units and residential projects is the commercial land title, which is mostly developed in prime locations. SoHo, SoVo, and SoFo are not official terms and were coined by developers for marketing purposes.

2. What Is a SoHo Unit (Small Office Home Office)?

The Small Office Home Office (SoHo) works as either a home or office, as its name suggests. Because it is normally used for residential purposes, SoHo units have everything a home requires, including a living roombedrooms, and fully fitted bathrooms. However, these units tend to be a little smaller (400 sq ft to 800 sq ft) compared to typical apartments but come with facilities and amenities akin to condominiums.

Is SoHo Under The HDA?

Yes, SoHo units are protected by HDA because they have the element of residential property. While you sign a sales and purchase agreement for SoHo units, it’s not the same for SoFo and SoVo units as they aren’t regulated under the Housing Development (Control and Licensing) Act 1966 (HDA).

Instead, you will sign a non-standard sales and purchase agreement with the property developer, drafted by the developer’s lawyer, which is not regulated by the HDA. Check the clauses in this non-standard sales and purchase agreement before signing it, as any dispute relating to your new SoFo and SoVo unit must be settled in court based on this agreement.

As for SoHo units, any disputes can be forwarded to the Tribunal for Homebuyer Claims as they are under HDA jurisdiction.

lawyer-property-malays
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Top SoHo Units for Sale and Rent in KL And Selangor

PropertySize (sf)Sale (RM)Rent (RM)
Scott Garden, KL775350,0001,500
Soho Suites KLCC829950,0003,500
Pacific 63, Petaling Jaya654 470,0002,200
Empire Damansara752288,0001,600
The Robertson688527,5003,000
Trefoil, Setia Alam486280,0001,500
*As of May 2024

3. What Is a SoVo Unit (Small Office Virtual / Versatile Office)?

The Small Office Virtual / Versatile Office (SoVo) is usually used for commercial purposes. Unlike SoFOs, SoVos are not protected under the HDA. It is also illegal to reside within a SoVo unit, as it is strictly for commercial use only.

As it’s primarily an office space, a SoVo comes equipped with telecommunication and infrastructural facilities for a small company or burgeoning start-up. SoVo developments generally also have fewer lifestyle facilities than SoHo developments do.

Check out properties for rent

Top SoVo Units for Sale In KL

SoVo units are great for start-up businesses and SMEs. They are versatile and easily configurable. If you are looking to get your own SoVo unit, check out these top picks below:

PropertySize (sf)Price (RM)
SoVo @ D’Sara SentralUp to 960911,000
Menara Suria (V12)517235,000
Menara UOA Bangsar1,098800,000
Q Sentral, KL Sentral1,0121.5 mil
The Vertical, Bangsar South939941,000
*As of May 2024

4. What Is a SoFo Unit (Small Office Flexible Office)?

The Small Office Flexible Office (SoFo) offers enhanced flexibility when it comes to your space whether as a place to stay or an office SoFo. SoFo units usually offer different types of layouts or come with internal partitions for buyers to customise the space according to their preferences (spaces for extra beds, for instance). Also, some SoFo developments allow you to enlarge a space by combining two adjoining units together. SoFo units also generally come with the facilities and amenities you’d expect from a condominium.

modern-home-office
© Vira Petrunina | 123rf

Top SoFo Units for Sale In KL

SoFo units are unique developments which can make for great office spaces for SMEs and new businesses. If you’re looking to get started on your SoFo property-buying journey, check out the top five SoFo developments in Kuala Lumpur below:

PropertySize (sf)Price (RM)
The Grand @ Kelana Damansara Suite400Starting from 225,000
Grand Subang @ SS13548Starting from 440,000
Edelweiss SOFO @ Tropicana Gardens556Starting from 651,000
*As of May 2024

5. What Do You Need to Know Before Purchasing a Soho, Sovo, or Sofo?

Loan Terms

In general, SoHo, SoVo or SoFo are commercial properties. This means that the maximum loan eligibility under your personal name is only 85% as opposed to the 90% for residential loans.

But on the bright side, as opposed to residential properties where you can get only a 70% loan on your third property and thereafter, commercial property buyers can continue to get a loan margin of between 80% to 85% for all commercial property purchases.

Due to the lower loan margin afforded to them, commercial property buyers will typically need to fork out a minimum of 15% to 20% of the property’s price as a downpayment. The amount will depend on the agreement between the buyer, the property developer, and their agreement with the bank.

Utility bills

As SoHo, SoVo or SoFo are commercial properties, the utility bills, commercial assessments, and quit rent are higher than residential units.

Why Do Commercial Developments Have Higher Utility Bills

Utility bills, such as electricity tariffs, for commercial properties are usually 30% to 50% higher than residential properties. So, clearly SoHo, SoVo and SoFo units will be more expensive for owners.

However, you can apply to TNB to change the tariff to residential from commercial.

TNB Tariff for residential title properties

commercial tnb tariffs
Source: TNB

TNB Tariff for commercial title properties

tnb tariff
Source: TNB

If the average cost per month for electricity is between RM70 to RM100 for residential units, you may be paying between RM140 to RM200 for a commercial unit.

As for water bills, take a look at the chart below to get an idea of the tariff rate differences between residential and commercial developments.

 Rate (RM/m³)Min. Charge (RM)
Domestic Usage 0 – 20 m³ 21 – 35 m³ > 35 m³  0.57 1.03 2.00  6.00
Commercial (Inclusive of Public Swimming Pool) 0 – 35 m³ > 35 m³    2.07 2.28    36.00
* Klang Valley only

According to the commercial property charges, you would be automatically paying a minimum of RM36 per month, regardless of the usage amount.

While SoHo, SoVo, or SoFo units are attractive for their great location and price, it’s important to consider the property’s loan terms and utility rates (commercial or residential). Do check with the property developer before considering to purchase a SoHo, SoVo, or SoFo unit, especially the clauses in the non-standard SPA signed for SoFo and SoVo units.

Disclaimer: The information is provided for general information only. iProperty.com Malaysia Sdn Bhd makes no representations or warranties in relation to the information, including but not limited to any representation or warranty as to the fitness for any particular purpose of the information to the fullest extent permitted by law. While every effort has been made to ensure that the information provided in this article is accurate, reliable, and complete as of the time of writing, the information provided in this article should not be relied upon to make any financial, investment, real estate or legal decisions. Additionally, the information should not substitute advice from a trained professional who can take into account your personal facts and circumstances, and we accept no liability if you use the information to form decisions.

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