Changes to housing policy to protect buyers’ rights

25/05/2008 The Star

KUALA LUMPUR: Major changes are in store for the housing industry once the Government amends certain aspects of the National Housing Policy.

Deputy Housing and Local Government Minister Datuk Hamzah Zainudin said it would focus on improving three areas.

These were building licence approvals, sales and purchase (S&P) agreements and project progress reports to the Government by developers.

He added that the changes were subject to the perusal of various housing development agencies, associations and industry players.

The thrust of the revamp, said Hamzah, was to ensure the rights of purchasers were protected and ensure projects were not abandoned mid-way due to lack of funds.

He said discussions with related parties would begin next week.

Explaining the three aspects, Hamzah said currently building licence approvals were acquired for a RM250,000 fee.

“This has been the practice but we found some developers do not possess the adequate cash-flow to get the job done later in the project,” he said after launching the Casa Idaman Condominum ground breaking ceremony yesterday.

“As such, we are proposing to implement an additional fee on the projected percentage of sales in order to obtain a building licence.”

On the S&P agreements, he said they were looking at several ideas to benefit both purchaser and developer. These could include a clause where purchasers would suffer minor losses if a project were to be abandoned.

“We will also propose that developers give more frequent reports on their projects to ensure they are financially stable to reach completion,’’ he said.

“Developers now provide reports only twice a year on the progress of their project.”