The way we see it
23/03/2002 Published in NST-PROP A Buyer Watch Article by National House Buyers Association

The House Buyers Association offers a perspective on certain issues related to the housing industry

The housing industry as a whole has shown some signs of degeneration over the past several years and this has aroused aroused a lot of suspicion and criticisms from dissatisfied house buyers. 

The quality of houses built has in many cases, been below expectation and does not reflect the prices that buyers are paying for them. This state of affairs has caused a growing concern among consumers that the industry might spiral into a worse situation unless immediate efforts are made to arrest the deterioration.

Over the past two years, the House Buyers' Association (HBA) has observed what has been happening to the industry and has realised that there are issues that still need to be addressed for the betterment of the industry.

Responsibility to the masses

Housing developers have apparently shown more inclination to build middle and higher-priced houses, which give hefty profits, unlike low-cost units with low profit margins. Such a shortsighted vision and lack of cooperation from housing developers to build low-cost houses might be construed as being non-supportive of the national development plans that have been diligently formulated by the government for the promotion of sustainable economic growth and nation building.

The existence of squatter communities alleging that they have been deprived of social justice and marginalized from the mainstream economic development should also be viewed with grave concern and requires the concerted effort of all parties.

It is for this reason that HBA hails that the proposal by the Selangor State Government to confiscate the land that was alienated to developers for the purpose of low-cost housing, but which they have failed to develop. We urge other state governments to follow suit.

We believe public housing for the low income earners should be built by the government,  which is in a better position to maintain the cost of houses of this category at RM35,000 or below. We therefore laud the the recent announcement by Housing and Local Government Minister Datuk Seri Ong Ka Ting that the Cabinet has given approval for the Federal Government to take over the building of low-cost homes from State governments with immediate effect.

While acknowledging that there is a dire need for affordable public housing in urban areas, Ong said that under the present set-up, "it is almost impossible for certain State governments to implement low-cost housing projects within the specified ceiling price as land prices are extremely high, especially in cities and big towns".

He said the high land prices and inability of State governments to get developers to undertake such projects had prompted the Federal government to step in to provide homes for the low-income group. He added low-cost house prices would be maintained at a maximum of RM35,000 for those in cities and major towns, RM30,000 for those a the fringe of major towns, RM28,000 for those in small towns and a ceiling of RM25,000 for those in rural areas.

Overcrowding

We have also discovered that certain developers tend to overcrowd their land with a maximum number of houses at the expense of open spaces that could promote a healthy lifestyle and a conducive environment. Local approving authorities should try to keep this trend in check as house buyers are entitled to recreational amenities and a quality of life. 

Build then sell

HBA advocates that implementation of  the build then sell policy, which we believe will forestall the problems of house buyers and help rebuild the eroded confidence of house buyers. Although the present economy and rate of development may not permit this on a large scale, it could still be applied to state-aligned projects, where land cost is minimum.

It is a disaster when a building cannot be completed on time, and if completed, is subject to complaints of shoddy workmanship and structural defects. It is also unsettling to the house buying market to hear of numerous cases where developers do not comply with the sale and purchase agreements and do not pay up liquidated ascertained damages.

Most of all, it is heart-rending to hear of people unable to move into a home they purchased with their life savings because the developer has failed to obtain the Certificate of Fitness, there are not utilities or the property has been abandoned altogether. Ownership without the ability to occupy the property one owns is meaningless.

If the market's trust in the industry is to be renewed, we have to take that first step of directing the responsibility where it belongs – on the developer. While the HBA is focused on pursing with the authorities the immediate need for increased enforcement to control the housing industry, we also urge developers to be more responsive to the call for honesty and transparency in the dealings with consumers.

They should as a matter of urgency adopt more innovative designs and technological advancement in their building plans of houses that could minimize cost without compromising quality.

Apart from developers, there are other players who are related to the housing industry, such as architects, lawyers, planners, engineers, surveyors and contractors who are equally bound to adhere strictly to their professional ethics.