How to convert a commercial property into a residential property?

Different areas may have different regulations and requirements for converting commercial property to residential property. It is best to consult your local authorities if you’re planning for a property conversion. Besides financial planning, time, necessary documents, and other challenges, it also depends on local authorities’ rules, regulations, and approvals. Once approved, you will enjoy residential rates for taxes, assessment rates, and utility fees.

Change in the category of land use

Under Section 52 of the National Land Code 1965, all alienated lands are divided into three categories of land use –  Agriculture, Building and Industry. Valuation for the change of land title or use is normally carried out by the Valuation and Property Services Department (JPPH). 

If a landowner intends to use his land for other use than the category stated in the title, the owner must apply to change the category of land use accordingly.  Sections 124 and 124A of the National Land Code and the respective State Land Rules allow landowners to apply for such changes. The State Authority will charge an additional premium on all applications approved for change of use.

Application for conversion of land title

The landowner must submit his application to the Land Office/ Land and Mines Office and must comply with all the requirements. The landowner must be able to provide:

  • Copy of the title;
  • Address of the property (if any);
  • Site plan;
  • Location plan;
  • Development proposal;
  • Feasibility study (if any); and
  • Valuation report (if any)

If an applicant fulfills all requirements, JPPH will then report the valuation to the Land Office/ Land and Mines Office within 10 working days upon receiving the application by the office.