Rescue for abandoned projects
The Malay Mail 21/09/2002

IN an attempt to address the problem of abandoned projects the Ministry of Housing and Local Government is studying a request to introduce an insurance scheme to protect house buyers' interests in the event of abandoned or non-completion of housing projects.

Deputy housing and local government minister Datuk M. Kayveas said that he will be looking into this request whereby buyers will receive some form of compensation should the properties they purchase fail to be completed on time or are abandoned altogether.

Speaking to the press after launching the Home Ownership Campaign 2002 Part II last week, Kayveas also pointed that the slow enforcement and prosecution of errant developers is set to change with the new Housing Development Act.

"The ministry has in the past been slow in prosecuting and punishing developers who flout the law but this is set to change under the new Housing Development Act which has its own enforcement team," said Kayveas.

"It will be enforced anytime soon once the formation of the housing tribunal is being finalised," the deputy minister said in reply to a question as to when the new Act will take effect although it has already been gazetted.

Kayveas also pointed that there is only so much the ministry can do, as in many cases the developers and/or their directors cannot be traced. He also pointed out that in any event, the government cannot keep on bailing out such developers.

"If it were to come to that the government might as well take over the construction of residential properties in the country," he said.

Meanwhile buyers of two abandoned housing projects in Kedah would be relieved to know that Syarikat Perumahan Negara (SPN) is currently proposing to take over Taman Budiman in Alor Setar and Taman Sri Gedung in Sungai Petani.

According to Kedah Menteri Besar Datuk Seri Syed Razak Syed Zain, SPN is expected to complete work on these two developments within six months.

Taman Sri Gedung, which has been abandoned for 10 years comprises 637 low-cost units and six shophouses while Taman Budiman which began in 1990 comprises 270 low- and medium-cost units.

SPN chairman Datuk Ahmad Zahid Hamidi said abandoned projects are taken over in the interest of buyers regardless of whether the developers in question incur a loss or not. To this end, SPN will complete a total of 28,000 residential units in 91 abandoned housing projects worth RM3 billion by 2005. To date the national housing corporation has completed 15 abandoned housing projects.