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Taking a proactive
stance
13/07/2002 Published
in NST-PROP A Buyer Watch Article by National House Buyers Association
In the second a two-part
article, the House Buyers Association proposes certain steps to expedite the
issuance of strata titles
Over the past three decades, we've seen the emergence of many highrise
projects dotting the skyline. The sad part of all this upward mobility is
that we've still not resolved the woes attached to strata titled properties,
which hinge largely on the attitudes of both developers and the relevant authorities.
Why the lackadaisical attitude? Several reasons come to mind:
- The developer has not put aside the expenses/fees for the application.
- Enforcement is slack and the threats of legal action have so far remained
just that; and
- Unless purchasers make a complaint, nobody knows if strata titles have
been applied for or not.
A check with the Ministry of Lands and Cooperative Development, which administers
the Strata Titles Act (STA), revealed that unless strata title property owners
register complaints, no action will be taken against the developers concerned.
The House Buyers Association is surprised that there is no system to monitor
whether developers comply with the need to apply for strata titles. The onus,
is seems, in on owners themselves to do the checking. On the same issue, no
one knows exactly how many strata property owners are still awaiting their
titles.
On our part, HBA proposes the following be done to expedite the application
of strata titles:
- Once the Certificate of Fitness for Occupation (CF) has been issued
for a particular building, copies should be made available to the Ministry
of Lands and Cooperative Development to ensure that Section 8 of the STA
is adhered to;
- Part of the balance purchase price, say, 2.5% be withheld until titles
have been transferred to the unit owners;
- Regulations should be imposed to ensure that all aspects of maintenance
and cost incidental thereto shall be the sole responsibility of the developer
till control has been transferred to the Management Corporation formed by
owners.
Currently, there is no standard to monitor the developer-controlled management
of strata title properties except those set by the developers themselves.
Our suggestions would give more protection to purchasers and spur developers
to expedite transfer of the titles.
Some complaints related to stratified properties that we've received from
owners include: having to pay developers "management fees" built into the
monthly maintenance charges; lack of transparency on the way these fees are
spent; poor maintenance of the property; inadequate parking space; unsatisfactory
repairs of defects; and increase of maintenance charges as when the developers
decide.
We have also received complaints on the "special account", also known as
"sinking fund" or "building fund" being used for purposes other than those
intended. Section 46 of the STA defines the restrictions of use of this "special
account" and using it in any other way is tantamount to a criminal breach
of trust.
There have been instances when homeowners have been blamed for the delay
in issuance of strata titles because they have refused to take possession
of them. HBA feels the sentiments and reasons for such a refusal should be
looked into before fingers are pointed at homeowners. After all, homeowners
could have valid reasons, such as:
a) Disputes over the standard of management when compared with the maintenance
charges levied;
b) Non-payment of late delivery compensation;
c) Shoddy workmanship and deviation from the built-up plans in the Sale
and Purchase Agreement;
d) Non-transparency in the use of the service charges and sinking funds;
e) Arm-twisting by developers for payment of "all out-standing charges"
(though disputed) in exchange for signing of the transfer of the strata title
to the house owners;
f) No common facilities built despite having covenanted in the Sale and
Purchase Agreement and the Deed of Mutual Covenant.
One of the most proactive methods of ensuring that property owners
get their strata titles has been initiated by the Melaka State Government,
which came up with a ruling that requires developers to submit applications
for strata titles when they apply for building plan approvals for stratified
units.
The Chief Minister Datuk Wira Mohd Ali Rustam said this is to ensure that
strata titles for such projects are issued at the same time as the CF.
This is certainly good news for buyers in the state.
We commend Mohd Ali for having the foresight to implement such a directive.
To lessen the woes of house buyers all over Malaysia, perhaps this ruling
should be implemented nationwide.
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