Better deal for house buyers

The Star 01/12/2006 By NG CHENG YEE

KUALA LUMPUR: The proposed amendment to the Housing Development (Control and Licensing) Act will have a major impact on the housing industry and housebuyers.

Housing and Local Government Minister Datuk Seri Ong Ka Ting said the proposed amendment – the second in five years – was to remedy certain weaknesses in the Act and to offer housebuyers better protection.

The Cabinet has approved the proposed amendment and the Bill will be tabled at the Parliament sitting this month. The last amendment was in December 2002.

Ong said if passed into law, the Tribunal for Housebuyer Claims would be able to hear cases involving a claim value of up to RM50,000, compared with the present RM25,000.

“Housebuyers can ask for compensation of up to RM50,000 per course of action if they find something wrong with their house,” he said after attending a RM1mil mock-cheque presentation under the Sunrise-Utar Fundraising Campaign here yesterday.

Ong said the maximum RM5,000 fine imposed on those who failed to abide by the tribunal's award would be increased to RM10,000.

“The jurisdiction of the tribunal will be clearer after the Act is amended. Provisions on the kind of claims, when housebuyers can make the claims and when the award needs to be followed up will be stated in the Act.”

He said the minister would be given the right to appoint retired members from the Judiciary and Legislative Service, advocates and solicitors and defence counsel from Sabah and Sarawak as members of the tribunal.

Ong said housebuyers would be able to take court action against developers without referring to housing loan institutions. This was to avoid complications and delays.

He added that housebuyers could also sell their units after signing the sale and purchase agreement under the amended Act.

“There are some developers who make it difficult for house buyers to sell their houses,” he said.

Those who commit offences like not opening or maintaining the Housing Development Account or building without licence would also face a higher penalty, from a maximum of RM50,000 to a maximum of RM250,000.

Engineers, architects or trustees who flout the Act could also be fined a maximum of RM100,000 or be jailed up to five years or both.

Ong said those who flouted the Housing Developers (Control and Licensing) Regulations and the Housing Developers (Housing Development Account) Regulations would be fined RM20,000 compared with the present RM5,000 or face up till five years jail compared with the current three years.

The amended Act, he said, would also provide incentives such as fast-track approval and a RM200,000 deposit exemption for housing development licences and stamp duties to developers who practised the “build-then-sell” concept.

“At present, developers will have to spend 18 months to two years to get approval for various applications, including approval for their building plans. The amendment will allow them to get everything done in only four months,” he said.

Under the proposed amendment, a Housing Controller, who will be the ministry's secretary-general, will be allowed to freeze the Housing Development Account of developers found to be flouting the Act.