This website is
 sponsored.gif

banner.gif

 Welcome    Main    Forum    FAQ    Useful Links    Sample Letters   Tribunal  

Grappling with contentions
18/07/2007 NST-PROP By National House Buyers Association

We refer to the Viewpoint presented by Datuk Eddy Chen, a past president of the Real Estate and Housing Developers' Association (Rehda) and chairman of the Board of Trustees of the Rehda Institute "Far from being rotten" (NST-Property, June 23).

In one fell swoop, the writer has cast aspersions on:

  • The National House Buyers' Association (HBA) for an imbalanced perspective; for a narrow and emotional view of the Malaysian housing scenario; and for not being able to see the national agenda;

  • The Construction Industry Development Board (CIDB) for failing in its moral duty to provide a stronger labour force for the housing industry;

  • The banks for breaching their fiduciary duty by "lending during a fine day, and taking it away when it rains"; and

  • The Government for its ineffective, inefficient delivery system.

The writer argued that the Sell-Then-Build (STB) system of housing delivery has enabled the provision of various social necessities that are peculiar to Malaysia.

We at the HBA say that not a single sen for the special and peculiar provisions come from developers. These costs are fully shouldered by house buyers, who collectively pay for social necessities as well as for discounts on bumiputera quotas.

Whatever system is used to build houses ? the STB; the Build-Then-Sell (BTS) or the 10:90 variant of the BTS, social necessities will be present. Housing isn't the only industry subjected certain requisites: Every other industry in Malaysia also has to operate within the framework of the National Development Policy (NDP).

The writer claims that "less than two per cent" of housing projects have failed or are abandoned. Translated arithmetically, it means that for every 100 buyers, two unfortunate ones are facing the devastating effect of abandoned houses. We think even a single case is one too many!

The present STB system has unwittingly cultivated a culture where sub-standard construction, shoddy workmanship, deviation from approved plans, non-availability of ownership papers, non-issuance of Certificates of Fitness and bullying on the part of errant industry players have become acceptable.

Complaints from house buyers inundate our website, so much so that a happy buyer is an exception. Many of those who have paid up or almost fully paid up for their houses would not have the financial means to take a developer to court over defects, major or minor.

The author also seems to suggest that revived projects should not be taken into account when tallying abandoned houses.

However, it must be kept in mind that failed projects which have been revived invariably incur additional costs, and therefore, do cause loss and distress to buyers.

Public money ? yours and mine ? is used to revive abandoned projects. That means those who cannot afford to buy a house also share the cost of reviving projects through public funds pumped into companies such as Syarikat Perumahan Negara Bhd.

The situation was best described by Prime Minister Datuk Seri Abdullah Ahmad Badawi during a dinner not too long ago at a businessmen?s club in Kuala Lumpur. There, he said: "Profits are privatised, while losses are nationalised."

The continuous tightening of housing laws the writer touched on reflect precisely the vulnerable situation house buyers, whether local or foreign, face. This is why the government is making every attempt to protect their interests.

On the issue that the HBA has taken a narrow, emotional view of the local housing scene because we constantly deal with aggrieved buyers ? and there are vast numbers of them ? we can only say this is farthest from the truth.

Our aim is to influence some orderliness in the industry so that future generations of house buyers need not suffer.

We have an education programme, and have even mediated in several disputes between buyers and developers. Our successes in this area come from the strong support and cooperation from buyers, as well as through acknowledgement from the authorities of the positive role we play.

The Tribunal for Home Buyers' Claims has proven effective where claims do not exceed RM50,000. But what about those saddled with abandoned projects, or with claims in excess of RM50,000? Furthermore, there are tribunal awards that are challenged by certain developers.

And what about housing projects cunningly camouflaged as commercial ones? And those cooperatives and government agencies that were not brought under the Housing Development (Control and Licensing) Act until the Act was amended in 2002? So much for the "very effective channel for aggrieved buyers ...". The writer should surf to the Housing Ministry?s website (www.kpkt.gov.my) to see the number of developers facing action.

Far from being imperfect, the STB method is downright hazardous for house buyers. But the writer implies that it is solely through this system that large numbers of houses have been delivered. We contend that the success of the housing industry is largely due to governmental efforts, such as price control on building materials and other essentials.

Bank Negara's guidelines for the finance industry to adopt a very pragmatic approach to the funding of housing projects and the provision of loans are other key factors, besides peace and political stability, which have influenced the development of the housing industry.

In light of the many problems arising out of the widely practised STB system, we suggest that the 10:90 variant of the BTS system be adopted as the interim measure, with full BTS as the national aspiration. We believe the government will not have to impose so much regulatory measures under the 10:90 system, since it would make the industry largely selfregulating.

 

Main   Forum  FAQ  Useful Links  Sample Letters  Tribunal  

National House Buyers Association (HBA)

No, 31, Level 3, Jalan Barat, Off Jalan Imbi, 55100, Kuala Lumpur, Malaysia
Tel: 03-21422225 | 012-3345 676 Fax: 03-22601803 Email: info@hba.org.my

© 2001-2009, National House Buyers Association of Malaysia. All Rights Reserved.