Vacant units pose a problem

The Star 27/10/2003 By S.C.Cheah

MOST of us have seen it: blocks of vacant shop offices, rows of dilapidated factories, and only a house or two being occupied out of a row of 10 to 20 empty houses.

In Selangor, there are empty units as far north as Lembah Beringin, Bandar Bukit Beruntung and Bukit Sentosa and in the south there are many vacant shops and factories in Bandar Baru Salak Tinggi and in Bangi.

Nilai in Negri Sembilan also has its share of empty units.

What can be done to turn “ghost” towns into a more thriving place to live and work in? This is one huge topic that cannot be addressed in a short article but I do have my wish list.

For a start, let us take a look at strata-titled properties like low-cost flats, apartments and shop offices. The last decade saw many townships being built far away from the city centre. The idea was to allow people to work and stay there but in reality there apparently were more investors than owner-occupiers.

Those who planned to move to these new townships were deterred by the distance, rising highway toll, and lack of job opportunities and schools.

Some people have conveniently blamed the location of the KL International Airport in Sepang for drawing much of the economic activities south and contributing to the glut situation north of the Klang Valley. I feel this is a lame excuse for a plain case of over-building.

There must be more concerted efforts and incentives to lure people to buy, invest and stay in these developments rather than forgetting about them and building some more.

The government: It can initiate a national campaign to encourage people to live in outlying areas and companies to relocate their businesses or set up branch offices there by waiving stamp duties, tax on rental income and other levies for a specific period (say one to three years). Companies that employ locals in these townships can apply for further tax exemptions. It can relocate certain industries to townships that face a glut of industrial properties.

The process of allocating low-cost units to the lower-income group should be expedited so as to fill the many vacant low-cost units instead of building more such units. The government's recent move to take over the building of low-cost housing and allowing developers the choice of paying a levy to fulfil their low-cost quota is a step in the right direction.

Local authorities: They should consider waiving or lowering assessment and other rates for vacant units. They should be more proactive in working with all parties to help populate a township. A well-populated township means more economic activities and, in turn, local councils can earn more revenue from business licences and even fees for putting up lighted signboards.

They should not neglect abandoned and vacant developments as they have a social obligation to ensure that they provide all-round services wherever possible.

Utility companies: To ease the burden of owners whose units are vacant, utility suppliers should consider lowering the deposit amount.

Purchasers: There should be a law mandating all owners of strata-titled properties to pay their service charges and, if possible, the sinking fund as well. It is unfair for a handful of responsible owners to shoulder the maintenance of their common property when the majority shirk their responsibilities. Defaulters can either be fined or in serious cases, possibly have their property confiscated and auctioned off.

Developers: With purchasers being forced to pay up their dues, there will no longer be any excuse for the developers to say that they do not have enough funds to maintain the property properly. The law should require a minimal level of maintenance.

Developers should be more transparent, especially on how the service charges are disbursed. They should offer an avenue for the purchasers to meet, like holding a monthly meet-the-unit owners' session to thrash out problems.

The developer should cooperate to see that vacant units are filled. Whenever there is an auction, they should give a lending hand to the bank or estate agents concerned by providing the keys to the units being offered for auction. This allows intending bidders to inspect the said property, especially where the original buyer had somehow not obtained vacant possession (a reason could be that the buyer has left the unit empty and tries not to pay all the service and other charges accrued over the years).

Developers have everything to gain when there is a new buyer for the auctioned property because in many cases, the defaulter who failed to repay his loan has also accumulated quite a sum of unpaid service charges and other bills. When a property is successfully auctioned off, most banks would oblige to pay off these outstanding bills to the developer, thus unlocking large sums of money. The successful bidder can also occupy or rent out the unit and help to bring in some life and economic activities to the township.

Also, instead of washing their hands clean after selling their units, there should be a law requiring that the developer provide a minimum level of security to strata-titled properties, particularly commercial centres. There have been many cases where vacant properties became a drug addicts' haunt, breeding ground for mosquitoes and crimes.