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Investment in knowledge pays the best interest
04/03/2005 The Sun

For many people, purchasing a home could well be the most important financial decision of their lives. Therefore, it makes sense to approach this decision carefully. Buying a home is unlike buying any other consumer product as it covers several grounds including legal, financial, technical and emotional considerations. To not educate yourself and learn from the mistakes of others only sets you up to be, at best, disappointed and at worst, "house poor".

Caveat emptor! Let the buyer beware - this means that buyers should take responsibility for the condition of the items they purchase and examine them before purchase. How true is this for property buyers? It works well for buyers of completed units but not for those buying from plans, when the construction has not even commenced and there is nothing for the buyer to inspect or assess. At least, with knowledge, you can enter the world of homeownership with more confidence.

First-time home buyers normally have little knowledge of what aspects to look out for when they are ready to acquire a home. The construction of a project involves numerous parties and legislation, and when problems arise, help in any form is often time-consuming and costly. Thus, the onus is on a prospective house buyer to be well educated on his rights and to seek help from all sources available before making the first payment.

In reality, there is no one-stop centre for a study of a developer's record. It is common practice for big corporations to start a new private limited company for every project; as such, you might not be able to check track records unless you have the names of all the subsidiary companies formed.

There are also instances where the project is a one-time venture that the company or individual undertakes. You will have to do some investigative work to get the information you want.

Here, we list some sources where a potential house buyer can do his research.

From the National House Buyers Association (HBA)'s website at www.hba.org.my. There are well over 2,000 pages of information, a forum board, publications, frequently asked questions as well as links to much more information. Numerous guides are available on specific subjects;

If the parent company is listed - check on Bursa Malaysia (formerly known as the Kuala Lumpur Stock Exchange)'s website at www.klse.com.my for the background and subsidiaries of the company. Also read all announcements for litigation news and public reports;

If the company is licensed by the Ministry of Housing and Local Government, check for information based on housing developers, licence and permit numbers, projects, list of the addresses of consultants, architects of projects, statistics and so on at www.kpkt.gov.my/idaman/index.htm. However, the information is only restricted to the subsidiary company or vendor and there is limited information on past performances. In some cases, the information has not been updated. Write to the ministry if the information that you seek has not been updated or make an attempt to visit the ministry's monitoring and enforcement division;

Check the archives of some online news providers that provide this service;

Ask the developer for the names of the projects it claims to have developed, so that you can go look for yourself and maybe contact some of the past buyers for feedback. Most developers would not hesitate to provide these references of their past projects and those with websites would have proudly listed all their subsidiaries and past projects on the websites;

Check also from websites that provide court decisions; for instance, www.kehakiman. gov.my or www.ipsofactoj.com. These sites provide a selection of cases of companies involved in lawsuits; and

Keep yourself up-to-date on news of housing-related laws and so on by reading and keeping articles of relevance in your own file: The "I didn't know that" expression seems to be a common grouse among aggrieved house buyers.

That makes us realise that house buyers often do not acquire enough knowledge in their own interest at the beginning of their quest for homeownership.

To help house buyers ask the right questions before purchasing, HBA has published a book entitled House Buyers Guide Book. It is designed to provide valuable information that house buyers are expected to know before they proceed with a purchase.

It is also to help them be aware of their rights as purchasers so as to be constantly on guard and to avoid the likelihood of possible and future pitfalls, vis-a-vis housing developers, in their quest to purchase a property "off the plans" - that is, incomplete units not readily available but under construction. The book, which is available in three languages, costs RM5.

Those interested may purchase by mail order via the HBA website or from its secretariat.

However, these are just the initial research stages. There are pros and cons of buying a new home from a developer. The pitfalls of buying "off-plan" are just too numerous to mention here. As such, a developer that understands the anxieties of a new house buyer, treats individual buyers with respect and assists in minimising problems is the kind of developer you would want to deal with. - The National House Buyers Association

The National House Buyers Association is a voluntary, non-governmental organisation that strives to protect house buyers' rights and interests. For more information, visit www. hba.org.my

 

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National House Buyers Association (HBA)

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