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Knock, knock! Any good developers
out there?
01/07/2004 Published in Malaysian Business - Housing & Property
By the National House Buyers Association of Malaysia
The qualities of good developers is
to be emulated, if you can find them.
THE housing industry has come a long
way since the advent of large scale housing
development in the late fifties and early sixties.
The players in those times were bona fide
entrepreneurs. Most probably, conscience ruled and
pride in workmanship, timely delivery of quality and
affordable houses were their hallmarks.
The present delivery system of `sell
then build' through progressive payments is fraught
with risk for the unsuspecting house buyers.
These second generation of housing
developers, good or bad, are used to lucrative
environment in the housing industry. This is so
because the post-independence period has been a
period of high population and economic growth.
Hence, the demand for housing is ever increasing. In
a sellers' market, the buyers are always
disadvantaged. When greed is inversely proportionate
to conscience among industry players, the situation
can get very bad indeed.
We often hear of developers lamenting
the fact that the shortage of workers (legal or
illegal, skill or inexperienced), shortage of
building materials, complying with new laws or
regulations making it hard for them to complete
their projects in time. At the same time, we also
hear of projects making profits of multi-million
ringgits for the developers and we do not see or
hear news of housing developers retiring or quitting
the business entirely. This would mean that the
housing development is still a lucrative business.
Enough on the bad ones, we at HBA do
keep our ears opened for the qualities of good
developers to be emulated. In the first place, how
do buyers judge if their developers have been good?
The construction industry is a very unique field. It
is one of a few professions where no formal
education is required. There is is no formal award
giving ceremony by buyers to tell the world their
developers have been 'good' and responsible.
There are also some other things the
good developers do that prove they have a passion
for their profession. Here are some of the traits
practised by good developers.
Attention to environment and existing
neighbourhood
Good developers do not just depend on
their buyers to pass around the word of their
reputation. No new project is an island. There are
existing neighbouring projects, trees, etc. A good
developer ensures the existing neighbourhood is not
disturbed by their new development. If there are
complaints eg cracks, landslide, floods that the new
construction is causing to the existing neighbours,
they are quickly attended to. They also ensure that
the existing roads are kept clean regularly from
construction activities.
Amenities, facilities and
infrastructure
Developers who provide adequate
amenities and facilities like playgrounds, schools,
markets, community halls and even police booths are
not only fulfilling the obligations imposed by the
local council but also their social responsibilities
to society. These developers are commendable as good
corporate citizens. It enhances their image too.
There too are developers who invest and build
infrastructures first prior to selling their houses.
Takes pride in quality and timely
rectification
Whether low cost or high cost houses,
chasing the developer to rectify shocking defects,
bad workmanship is a nightmare to buyers who lose
out while waiting for repair works. Good developers
do their own quality check before handing over their
products. Caring developers do practise the
following before handing over their products.
-
Adopt quality check at all stages of
construction, test and commissioned utility
supplies;
-
Clear and clean individual units and
construction site from construction debris;
-
Ensuring the Certificate of Fitness
for Occupation is timely with the handover;
-
Retain a team of competent workers to
do rectification promptly if there are complaints on
defects.
Some developers even extend the
mandatory defects liability period of 18 months. We
have also heard of developers providing alternative
lodgings for their buyers while waiting for defects
to be corrected.
Timely delivery
Time of the essence of the contract
of sale and purchase. Houses should be delivered
within the time stipulated in the sale and purchase
agreement ie within 24 months for 'land and
building' and 36 months for 'building intended for
subdivision'. If for whatever reason, there are
delays, compensation should be paid immediately to
buyers without second thoughts or finding devious
ways to 'short change' the buyers.
Good developers keep their buyers
informed of delays and tell them of the next
expected delivery date. Some buyers even told us of
the extras they have received at delivery time,
which surely endears them to the developers. These
are some of the 'welcome packs' that they have
received: Useful gifts like key box; warranties from
paint companies, auto-gates, pest control,
electrical appliances; certificates of treatment for
termites / pest control; a copy of the Certificate
of Fitness for Occupation issued by the Local
Council and certified as a copy of the original.
Interest charged
One clause in the sales contract
states that the buyers is responsible for late
payment interest. It is a common complaint by buyers
that their developers would charge interest for late
payment even though it is the fault of the
end-financier or their lawyers doing the legal
documentation. Good developers assist in ensuring
that the documentations are in order and the buyer
is not burdened with any late payment interest.
Joint management (for subdivision)
Good developers assist their buyers
to form committees and be prepared for the formation
of the management corporation. These developers
realise that the projects they have developed will
eventually pass to the owners to maintain and
manage.
Encouraging community living
Developers who encourage forming of
resident/owners association are a welcome lot. Some
even go to the extend of contributing monies for the
formulation of buyers representative group for a
meaningful channel to voice grievances. Some even
provide meeting facilities and allocate a
multipurpose room for the elected representative
group.
Good communication
The line of communication should
always be open between buyers and their developers.
It is obvious to do so for the obvious reasons:
-
Keeping buyers informed of the
ongoing projects and their products;
-
Developers not to appear having shun
away from their responsibility;
-
Treating the buyers with respect as
buyers can serve as their marketing tool. Show
respect and you will gain respect;
-
Transparency and accountability on
monies collected;
-
Providing regular accounting reports
and budgets;
-
Voicing of any grievances rather than
through the media, which will bring adverse effect
to the detriment of both parties.
Build first then sell
There is no step that can be more
pronounced than for housing developers to adopt the
'built first then sell' so that potential buyers can
see for themselves the finished product before
buying. We believe that in this way, most of the
present day ailments afflicting the housing industry
can be avoided and the housing industry will be a
lot more orderly.
There are good developers whose names
are synonymous with quality and trust. They are able
to win over buyer's confidence. Today, they have
created their own brand names. No wonder some
developers do not advertise, yet all their units are
sold-out even before the official launch. |
