10/90 Nod for build-then-sell housing concept
New Straits Times 23/06/2006

PUTRAJAYA: Houses in certain development projects will be built first before being sold, under the much-awaited "build-then-sell" (BTS) concept agreed to by the Government yesterday.

Under the arrangement, housebuyers will have to pay a 10 per cent down payment, with the remainder to be settled upon completion.

This "approval in principle", to be reviewed after two years, will provide more protection for buyers and help reduce the number of abandoned housing projects in the country.

Deputy Prime Minister Datuk Seri Najib Razak announced this after chairing the meeting of the National Council for Local Governments at his office here yesterday.

"This is just a ‘in principle approval’, as in terms of implementation we still have to discuss the matter on a case-by-case basis with State Governments and the local authorities," Najib said.

"Other conditions and factors still need to be finalised, such as the actual number of low-and medium-cost houses in the country. Distribution (of houses) has to be based on localities and demand, so we cannot come up with a general policy."

The BTS system will run parallel with the existing "sell-then-build" (STB) system, which requires progress payments.

"I want to emphasise here that the conventional system is not being abolished. Under STB, progress payments have to be paid. We are giving developers the chance to choose which system they want. However, details and conditions will be discussed on a case-by-case basis," said Najib.

With the introduction of BTS, a minor amendment to the Housing Act would have to be made.

Asked if the BTS system would eventually replace the STB system, he said: "We will review the concept in the next two years.

"We must not forget that small-and medium-sized developers may have to close shop as they do not have the strength and financial capability to adopt the BTS system. We have considered all views. We will look at the development and progress in the next two years before making any decision."

Yesterday’s meeting also approved a new policy pertaining to the sale of government low-cost houses to tenants.

"The houses were built to solve the problem of squatters. We have received many applications and appeals to enable the occupants to buy the houses, and this will be allowed," Najib said.

Such houses are priced at RM35,000 in the peninsula and about 20 per cent more in Sabah and Sarawak.

The policy will be discussed with State Governments and local authorities.

The authorities will identify low-cost housing areas where this policy can be applied and other locations where rentals will continue to be
imposed.

Najib also said the council agreed that Certificates of Completion and Compliance (CCC), currently issued by local authorities, would be
ssued by professionals instead.

"Six Acts will have to be amended following this approval, and the Housing and Local Government will table the amendments at the next Parliament sitting."

The move, he said, would minimise bureaucracy and expedite the issuance of CCCs.