Housing and Local Government Ministry has imposed stricter conditions since last April in approving new licenses for housing developers in efforts to check abandoned projects.

Its Minister Datuk Seri Ong Ka Ting said the ministry has also stipulated basic conditions that would better protect housebuyers’ interest.

Among the conditions are ensuring developers had the financial resources to carry out the projects and land conversion had been done before applications were made, he said.

Land and Cooperative Development Deputy Minister Dr Tan Kee Kwong said that the proposed amendments to the Strata Titles Act 1985 will include a 10-fold increase in the penalty for developers of highrise buildings who did not apply for strata titles.

He said the government hopes that the higher fine would act as a deterrent to developers who are thinking of not fulfilling their responsibilities. He also said it was the developers’ responsibility to apply for strata titles for their development projects after the issuance of the certificate of fitness (CFs) for occupation by the local authorities.

Existing legislation empowers the state authorities to prosecute developers failing to apply for strata titles within six months upon issuance of the CF or on signing of the sales and purchase agreement. Defaulters are liable to the fined RM5000 and an additional RM1000 for failure to apply for the strata title foe each subsequent six month period. The amendments were been tabled for first reading in the Dewan Rakyat and will be debated in Parliament early next year.

The minister said the amended Act may come into force by September after it has been gazetted.

As at Nov 30, the Kuala Lumpur land office has received 1639 application for strata titles (85882 units), of which 1122 application (62312 units) have been approved, while 1066 applications (55296 units) have been issued with strata titles certificates. Tan said that this accounts for more than 60 per cent approval rate for strata titles in Kuala Lumpur alone, which has one of the highest number of highrise buildings in the country.

Ong said the fund to revive abandoned housing projects will be relaunched under the purview of Syarikat Perumahan Negara. He said the ministry had discussed the matter with the Finance Ministry following an increase in abandoned projects during the economic downturn two years ago.

“We have identified more than 40 abandoned projects, which we think can be revived,” he said at Dewan Rakyat early this week.

The fund however, would only be utilized for projects, which can be redeveloped, especially those with buyers who are still keen on the project. An estimated sum of RM1 billion would be needed to revive the projects.

Ong also said the government has exceeded its target of building 800000 units of houses under the Seventh Malaysia Plan. He said 860000 units or 107 per cent of the overall target. To address this problem, he Government has introduced special programmes like the integrated public housing programmes. Under the programmes, 34000 low-cost houses are expected to be completed between 2003 and 2005.

KL Setral’s first phase will comprise the KL Central Station, Plaza Central corporate office suites, condominium apartments, a retail centre and hotels is scheduled for completion by 2004.

The Central Station will be the main focus of the mammoth development being the convergence point of trains not only from all parts of Kuala Lumpur and the Klang Valley, but around the country as well especially exit points like the Kuala Lumpur International Airport and Port Klang.

Among the various transit systems that will pass through the platforms of the Central Station are the Putra-LRT, the Star-LRT, the KL Monorail and the KTM Komuter. The KTM express trains, will also stop here, and this service links commuters to all parts of the country and even Singapore ad Bangkok.

The electronic rail link - a service which takes you to the KLIA – stops here too, effectively making the KL Central Station an airport terminal right in the heart of the city. Check-in will be possible from the station itself.

Foreign investors have not been making their way here aside from the acquisitions by the Citibank group and the recent real estate division of Singapore’s Government Investment Corporation.

The cool response is attributed to prohibitive asking prices set by owners. With weak rentals, foreign funds can only meet expected returns if they can buy properties at depressed values. The country is perceived to be expensive in price or yield terms by foreign investors.

Inconsistent policies on foreign property ownership is another factor. It is not so much the Foreign Investment Committee (FIC) guidelines per se, but more the inconsistencies. As foreign property acquisition is subject to FIC approval, policies uncertainties are an additional barrier to investing in Malaysia. Its investors are said to be reluctant to invest time and money on negotiation and due diligence unless they know the likelihood of success in obtaining the FIC’s approval.

Estate agents said that the Government’s efforts to entice Malaysians home from abroad wit attractive proposals in the 2001 Budget could have a positive impact on properties especially in and around the Multimedia Super Corridor.

Agents anticipate an inflow of foreign currency, which could be invested in completed residential properties.

Agents feel that secondary market areas such as Puchong and Seri Petaling, that are close to the country’s technology hub, the MSC would prosper from this repatriation of funds. Other properties in demand would be completed units in the residential precints of Putrajaya which are being pegged from RM250,000.

For residential properties currently, being built in the flagship zone of Cyberjaya, agents said their rental and resale prospects could be quite good once completed by 2003. This is due to the technology that will be incorporated in the houses, such as cheap broadband for 24 hour Internet connection and video-on-demand.

A total of 528 units of houses were reported to have been sold in four days during the recently held property exhibition in Johor. The lack of incentive and frequent campaigns were said to be among the reasons the recent property exhibition did not succeed.

Housing Developers Association chairman (Johor Branch) Paw Teck Hua said this number constituted four percent of the total 13609 units of houses available during the exhibition.

He said 36 developers who participated in the exhibition only managed to sell properties worth RM92 million. It was felt that the campaign has lost its bite and interested buyers have already made their purchases during the last two home ownership campaigns.

Despite the low sales volume, Paw said Johor registered the second highest sales in the country during the exhibition. He added that the aim to attract foreign buyers also failed as only 16 units were taken up.