Protect buyers of abandoned projects first: Association

The Sun 9/5/2006

PETALING JAYA: House buyers laud the government's move to consider extending the housing defects liability period from 18 to 36 months, but feel there are also other pressing issues that deserve attention as well.

National House Buyers Association (HBA) secretary-general Chang Kim Loong said today (May 8, 2006) a 36-month liability warranty is a good programme, but noted that housing defects detected after the warranty period are termed latent defects that are covered by the Housing Development Act.

He said such latent defects are covered within a three to five-year protection period after the warranty period ends.

As such, it is more pressing for the government to prioritise guarantee for house buyers of abandoned housing projects.

"Besides extending the warranty period, the government should first think about how to protect the interest of house buyers when housing projects are abandoned," Chang told theSun.

He said the build-then-sell 10:90 concept introduced by the HBA four years ago, which required house buyers to pay only 10% of downpayment and the rest after a house is issued with certificate of fitness and land title, has yet to be realised.

The concept would be better to protect house buyers.

Asked if developers can cope with the cost of a 36-month defect liability, Chang said contractors will have to bear the cost as it is their responsibility to give warranty to developers.

The Real Estate and Housing Developers' Association (Rehda) said the housing industry is over-legislated and 18 months of defect liability is sufficient.

Its president, Datuk Jeffrey Ng, said not all developers can afford to offer a longer warranty period and proposed that developers be allowed to extend the warranty voluntarily, as a marketing tool.

Ng said responsible developers would still provide service to housebuyers, even after the 18-month defect liability period.

It was reported yesterday the Housing and Local Government Ministry may consider making a 36-month defect liability period a standard practice, after a similar warranty programme was launched by leading housing developer, SP Setia Sdn Bhd, on Sunday.