Paying mortgage, but no house
NST By Reme Ahmad
Thousands pay for abandoned projects for fear of being blacklisted by banks
For 23 years now, the family of Ms Rosnah Halim has been dutifully paying
RM292 (S$128) a month as mortgage for a single-storey terrace house in
Negeri Sembilan, even though the project has been abandoned by its developer
'My little baby has become a working man, but I still do not see much hope
that the project will ever be ready,' said the 49-year-old traditional
She is among thousands of house buyers across the country whose projects
have been abandoned by the developers, but these victims cannot stop paying
the monthly mortgage because they fear their names would be blacklisted by
Tens of thousands of innocent buyers face financial distress because of the
abandoned housing projects, Mr Chang Kim Loong, secretary-general of the
National House Buyers Association, said in a letter sent to newspapers two
Government records show that there are currently some 90,000 units from 261
projects, with a market value of RM8 billion, that have been abandoned.
A project is defined as abandoned if it is not complete and if no
construction is taking place six months after the scheduled completion date.
While some projects were abandoned due to the 1997/98 Asian financial
crisis, others were simply scams.
'The issue is a huge concern as it has been going on for years,' said Mr
Darshan Singh, manager of the National Consumer Complaints Centre.
'We do not seem to have the political will to protect house buyers.'
But with consumer activists now demanding that the government take action,
some change could be in the offing.
Housing and Local Government Minister Ong Ka Ting said recently that his
ministry had completed its study on the issue and plans to present it to the
Details of his study are not known, but consumers want the current
sell-then-build practice for projects to be replaced by a build-then-sell
But real estate developers object to any such move.
The Real Estate and Housing Developers Association said that 60 per cent of
them would be pushed out of business as they have to fund much of the
Quite likely, the debate will continue while thousands will continue to pay
for a house they may not own in their lifetime.