Developers: Study implications of build and sell concept
25/05/2004 The Star

KUALA LUMPUR: The Real Estate and Housing Developers Association Malaysia (Rehda) has urged the Government to study the implications of the build and sell concept.

Its president, Datuk Jeffrey Ng Tiong Lip, said this was necessary as the country's economy and development were not at a level of maturity to allow the concept to be implemented immediately.

“The adoption of the build and sell concept would result in a significant reduction in housing production and market players.

“It would also lead to severe social and economic implications,” he told a press conference.

He was commenting on Prime Minister Datuk Seri Abdullah Ahmad Badawi's statement that the Government would find the best way to implement the build and sell concept.

Ng said the present system of buying houses off the plans had worked well for the country and helped fulfil the national objectives of providing homes for the population and generating sustainable economic growth.

He said the amended Housing Development Act had also served as an effective tool to address the house-buyers' problems and complaints.

“We feel the Housing and Local Government Ministry has been doing a good job in enforcing the laws and regulations,” Ng said.

Ng said major reforms at the financial institutions would be required under the build and sell concept.

“The institutions are unlikely to lend when they are unable to gauge the viability of projects based on the concept,” he said.

Ng said under the concept, very few developers would have the financial capital or capacity to carry out project development on their own without financing from banks or purchasers.

He said house prices would go up and the livelihood of about 150 other spin-off businesses would be affected if the concept was implemented.

To a question, he said only a small number of developers were constructing houses under the concept in the country.