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Review Needed
To Avoid Abandoned Housing Projects
26/11/2008 Bernama
DISAPPOINTED.. Victim of an abandoned housing project, Kamarolzaman Ismail
is showing the sales and purchase agreement which he signed in June 1999
to BERNAMA at the abandoned housing project that was to be his new home in
Puncak Alam, Shah Alam, recently. According to him, his house was supposed
to be ready for occupation by Jun 2002 but until today, it has not been
completed and has been abandoned instead. In addition to that, he still
needs to pay RM1,200 a month for 20 years to the bank to pay off his
housing loan. Pic: Mohd Najhan Azman
By Mohd Najhan Azman Hamid
KUALA LUMPUR, Nov 26 (Bernama) -- "I have to pay the bank RM1,200 monthly,
but my house is not completed yet and in fact the construction work has
been abandoned.
"The sales and purchase agreement was signed in June 1999 and the
completion date given was June 2002, yet until today (November, 2008)
there are no signs that house will be ready for occupation," lamented
Kamarolzaman Ismail to Bernama on the house that he purchased in a housing
project near Puncak Alam, Selangor.
Meanwhile, in Seri Kembangan 561 buyers of single story terrace houses are
in a fix. They were promised vacant possession in 2005 but construction
work has stalled.
"As at November 2008, the houses are yet to be completed," said the Buyers
and Claims Committee chairman Mat Ali Hanafiah Mohamed who represented the
buyers.
"We have to service the loan to avoid being sued by the banks and at the
same time have to pay rental for the houses that we are occupying now," he
too lamented.
Kamarolzaman and Mat Ali are among the unfortunate house buyers who have
many time met with the authorities to find ways to revive their respective
housing projects but there is no solution in sight for them.
Though year after year abandoned housing projects have been widely
highlighted by the local media, the authorities are yet find an effective
solution to help buyers who are left in a lurch.
FRIGHTENING STATISTICS
According to the statistics provided by the Housing and Local Government
Ministry, abandoned housing projects are nothing new and has been reported
since the 1970s.
Even now housing projects are being abandoned and their numbers are
expected to increase especially when looking at the current poor economic
outlook.
According to the statistics from the Ministry, the total number of
abandoned housing projects up to June, 2005 numbered 277, with 50,183
buyers, 75,356 dwellings and the projects were worth RM7.033 billion.
THE REAL SITUATION
According to a law don at Universiti Utara Malaysia (UUM), Nuarrual Hilal
Md. Dahlan, the numbers provided does not represent the true picture.
This is because some of the abandoned projects are not listed in the
abandoned housing projects list or the project files have been closed.
"Furthermore, the total number reported by the Ministry does not include
projects undertaken by independent contractors, cooperatives and others
who are not under the purview of Housing Development Act (Control and
Licensing) 1966 (Act 118) and also abandoned housing projects in Sabah and
Sarawak.
"Thus, if these projects are taken into consideration, definitely the
actual figure is much higher. This will then send a clear message on how
to avoid abandoned housing projects and ensure the rights of the buyers
are protected," he said.
REASONS WHY PROJECTS ABANDONED
According to Nuarrual Hilal, among the reasons for abandoned housing
projects includes the inherent weakness in the housing development system,
the loopholes in the laws and the lack of enforcement in the part of the
ministry, local enforcement agencies, planning and technical authorities.
Even more lacking is the political will in implementing significant and
radical changes in the housing sector where the problem has persisted
since the 1970s.
He is of the opinion that if all the housing developers in Malaysia
implement the build and sell' concept, the question of abandoned housing
projects will not arise.
FOLLOW THE EXAMPLE SET BY OTHER COUNTRIES
This system, for example, has been implemented in Singapore and New South
Wales, Australia. In Singapore, this task was entrusted to the Housing
Development Board (HDB)under the Ministry of National Development.
To emulate Singapore, the government must entrust the task to a government
agency with adequate financial resources to implement housing projects all
over the nation.
This agency will then carry out housing projects based on the 'build and
sell' concept as done by HDB.
What 'build and sell' concept means is that the developer can only sell
the houses when they are completed with Completion and Conformation
Certificate (CCC) issued and the ownership can be transferred to the buyer
immediately.
Nuarrual Hilal noted that insurance coverage for housing projects, as
implemented in New South Wales can also be implemented in Malaysia. This
is to ensure that in the event the developer defaults in his obligation
they buyers still have an avenue to see their homes completed.
LEGALITY ASPECTS MUST BE REVIEWED
In a nutshell, a comprehensive review is needed on the National Land Code
(1965), planning laws, building and housing laws, Town and Country
Planning 1976, Street, Drainage and Building Act 1974, Building By-laws
1984 and Housing Development Act (Control and Licensing) 1966.
The review should also include provisions for special laws to regulate the
rehabilitation of abandoned projects.
He opined that though there was several provision introduced in some of
the legislations in 2007, it remained insufficient as it failed to address
the core problems, especially those involving abandoned projects.
ADVICE TO BUYERS
Looking at the failure to prevent abandoned projects, he advised the
public to only buy houses completed with CCC.
"Maybe they may cost more, but it saves the trouble for the buyers.
"The government must take effective steps, including implementing the
above proposals, to prevent public and investors, local and foreign, from
losing confidence on the real estate and the banking industry due to the
risks from abandoned projects," he said ending the interview.
-- BERNAMA |
