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Building Approvals To Be Within Six Months, From Two Years
13/04/2007 Bernama

KUALA LUMPUR, April 13 (Bernama) -- The Ministry of Housing and Local Government will introduce four approaches to improve the public delivery system for the property sector.

The ministry said a new one-stop centre will be set up aimed at shortening the approval time for developers to construct buildings to four to six months compared with the current processing time of between one and two years.

The Certificate of Completion and Compliance issued by professionals will replace the Certificate of Fitness for Occupation presently issued by the local governments, it said in a statement today.

The creation of the post of Building Commissioner in the Buildings and Property Act is to overcome problems in the maintenance and management of buildings and property.

Also, the government will offer incentives to encourage developers to use the build and sell concept.

Under the build and sell concept, developers sell the houses only after they have been completed and the Certificate of Completion and Compliance (CCC) obtained.

Buyers will not be required to place deposits or make progress payments, the ministry said.

There is also a partial build and sell concept where developers can sell houses before they are completed but when the sale and purchase agreement is signed, a buyer only has to pay 10 per cent of the house price up front.

The balance will begin to be paid only upon completion of the house and the CCC obtained.

A buyer can inspect the house he or she has booked before deciding whether to complete the purchase and pay the remainder of the house cost.

The ministry said this means the risk faced by a buyer in a housing scheme which is later abandoned will only be 10 per cent of the house price.

It also means reduced risk for the financial institutions providing loans to house buyers, it added.

The instalment payments for a house loan begins only when it is ready for occupation, and the buyer need not pay interest on the loan until then, it said.

The ministry said that to encourage developers to accept the partial build and sell concept, the following incentives will be offered:

* Exemption from payment of the RM200,000 deposit for a housing developer's licence.

* Removal of the condition for 30 per cent of a housing scheme to comprise low-cost units.

* Priority in all official matters concerning developers, such as amendments to land use, land alienation, and approvals of structure and building plans, coupled with a shorter processing period of four months.

The ministry said the one-stop centre will operate on the fast lane concept to ensure that approvals are given within four months for applications by developers practising the build and sell concept, and those handling high impact projects, projects involving foreign investments and government development projects.

The approval period for other projects outside these categories will take six months.

This, according to the ministry, places Malaysia on par with several other countries - Singapore five and a half months, South Australia seven and a half months.



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