Penang TIP rules: Which properties can be used for short-term stays?
Owners and operators of Private Accommodation Premises (Tempat Inap Persendirian, or TIP) in Penang have been given a two-month grace period until November 1, 2026 to submit licence applications following the enforcement of the Private Accommodation Premises By-Laws (Penang State Local Authorities) 2026 (TIP By-Laws 2026) on August 1.
Penang Local Government, Town and Country Planning Committee chairman H’ng Mooi Lye said the grace period was introduced to give TIP operators sufficient time to prepare and submit their applications to the relevant local authorities.
She said enforcement action would be taken after the grace period based on the provisions of the new by-laws.
The new regulations aim to ensure the short-term accommodation industry develops in a more orderly manner while safeguarding the safety, peace and wellbeing of local communities.
According to H’ng, the Penang Island City Council (MBPP) received 364 complaints involving public nuisance and health issues related to TIP operations between 2020 and March 2026, while the Seberang Perai City Council (MBSP) recorded 24 similar complaints.
Although TIPs contribute to the tourism sector and provide economic opportunities, operators must conduct their businesses responsibly and take into account the interests of nearby residents, she said.
The TIP By-Laws 2026, approved by the State Executive Council on June 10, also provide clearer enforcement powers compared with previous guidelines. These include powers to investigate, enter premises and close premises for non-compliance.
Penang is believed to be the first state in Malaysia to introduce specific by-laws governing TIP operations.
The fees include a RM50 application administration fee and an annual licence fee of RM1,000 for premises with up to three rooms. Premises with more than three rooms will incur an additional RM200 per year for each extra room, up to two additional rooms.
A separate TIP fee of RM1,800 per unit per year applies, while a RM5 fee is imposed for each notice issued for outstanding payments.
TIP operations are prohibited in government or statutory body premises, healthcare or childcare centres, workers’ hostels, private educational institutions, as well as low-cost, low-medium-cost, affordable housing and People’s Housing Projects.
Within MBPP’s jurisdiction, TIP operations may be considered in designated residential and commercial zones, subject to planning requirements. Landed individual-title properties such as detached, semi-detached and terrace houses may be considered, subject to an application to change the building’s use.
For stratified properties, the types of properties permitted to operate as TIPs vary between the MBPP (Penang Island) and MBSP (Seberang Perai) areas. In general, strata residential properties on Penang Island are not permitted to operate as TIPs, while a wider range of strata properties is allowed on the mainland. The permitted property types are as follows:
Penang Island (MBPP):
- Serviced apartments
- Small Office Home Office (SoHo)
- Small Office Flexible Office (SoFo)
- Small Office Virtual Office (SoVo)
- Suite offices
- Duplex offices
Seberang Perai (MBSP):
- Apartments
- Serviced apartments
- Condominiums
- Townhouses
- Small Office Home Office (SoHo)
- Small Office Flexible Office (SoFo)
- Small Office Virtual Office (SoVo)
- Suite offices
- Duplex offices
- Landed strata properties
Owners or operators must also obtain approval from the relevant Joint Management Body (JMB) or Management Corporation (MC) to use the property for TIP operations. The application is subject to approval at the relevant general meeting, with a special resolution requiring at least 75% of valid votes.
The state government said the new regulatory framework is intended to strike a balance between supporting tourism and protecting the wellbeing of local communities.
