Build-and-sell concept delayed
by economic downturn
19/01/2009 The Star By Christina
KLANG: The build-and-sell concept will not take off in full swing due the
current global economy meltdown, said Housing and Local Government Minister
Datuk Seri Ong Ka Chuan.
He said the government had to take into consideration various issues
including the financial aspect when implementing the new system.
Ong said the build-then-sell concept works on a ratio of 10:90, where house
buyers pay 10% of the purchase price first and the remaining 90% upon
“Unfortunately, the system could not be implemented fully just yet because
of the global economy situation now.
“The government is very careful (in implementing the new concept), not
because we want to protect the developers but because the housing industry
is very important to the country as it creates lots of job opportunities,”
he said after launching SP Setia 5:95 home loan package on Monday.
Ong said if the government was not careful enough, it might kill the housing
Unlike big developers, the smaller players might fail to gain the confidence
of the banking sector to acquire loans to start their projects, he said.
As a result, the ministry had suggested running the new concept parallel
with the existing housing development system, Ong said.
However, the government welcomed developers who executed the new concept on
their own initiative, he said.
The government would encourage such developers by giving them some
incentives, he said.
Ong added the new system would be implemented when the infrastructure was
ready and the financial institutions well prepared.
Ong also said 100,000 housing units were being built every year and 2.7mil
units had been built over the past 25 years, however, 30,000 units were
He said there were some 80,000 units abandoned initially and the government
managed to salvage these projects and brought down the number by 40,000.
He added the new build-and-sell concept came after the ministry received a
lot of complaints by house buyers about abandoned projects.