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Advantage to developers, for now
NST 30/05/2004 By K.T. Chelvi

Housing and Local Government Minister Datuk Sri Ong Ka Ting recently declared that errant developers would not be given new licences. Ong said this was to prevent abandoned projects as well as numerous other problems faced by house buyers.

Finally, a panacea for the woes of house buyers everywhere? Abandoned projects are not new; it has been the construction industry's perpetual pain in the behind since the 80's. And for the buyers who have been left in the lurch, the pain is more intense. It is therefore heartening to note that after about 20 years, the authorities have finally got around to finding a solution.

Other problems plaguing buyers include the late delivery of properties, shoddy workmanship, and the failure to obtain certificate of fitness and strata titles.

In 2002, the House Buyers Association (HBA), a non-governmental organisation, championing the cause of house buyers, received 105,000 complaints.

The most number of complaints concerned strata titles, followed by maintenance, certificate of fitness, late delivery of houses and shoddy workmanship. Abandoned housing projects accounted for six per cent of the total number complaints received that year. According to the Local Government and Housing Ministry statistic for the same year, 447 of the 1,926 complaints were on late delivery of properties, followed by 287 complaints on shoddy workmanship.

Complaints are expected to rise in tandem with the number of houses being built. According to HBA, buyers are exposed to exploitation the moment they decide to shop for a property.

More often than not, buyers are so drawn to the sophisticated marketing tactics and attractive artist's impression that they fail to notice the developer's disclaimer.

The disclaimer in fine print usually reads: "The information contained is subject to change and cannot form part of an offer or contract. All measurements are approximate ... the developer cannot be held responsible for inaccuracies."

So a dream house in the Garden of Eden may end up being a house on a barren piece of land. And the buyer may not be able to do anything as the "sales gimmick" is not part of the sale and purchase contract.

HBA adds that this is precisely the reason why developers keep using misleading advertisements to entice buyers.

Other misleading gimmicks include the "proposed highway" which may never materialise during the buyers' life time, "growth potential" whereby buyers believing this claim have ended up with shoplots in a satellite ghost town, and "guaranteed returns" - which may also not materialise. The association also warns the buyers to be cautious over claims of "free legal fees" which are becoming a standard practice.

"These lawyers are actually paid by the developers and will end up looking after their interest and not the buyers should a dispute arise," according to an article posted on the association's website.

The Housing and Local Government Ministry's decision to award licences to only scrupulous developers may be a start - but it is not enough to settle all the woes of the house buyers.

House buyers - the party with the weaker bargaining power  - need to be protected from misrepresentation, shoddy workmanship and host of problems which seems to have become part and parcel of owning a home.

The ministry could probably start by guaranteeing the enforcement of the new and much improved Housing Developers (Control and Licensing) (Amendment) Act 2002.


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