An informative post about Penang.
House buyers’ group is skeptical of Putrajaya’s plan to amend a law regulating housing developers, purportedly to aid buyers affected by abandoned projects.
The National House Buyers Association said the government should focus on enforcing the law instead of making more amendments.
The association’s secretary-general, Chang Kim Loong, quipped that it was almost customary for every housing minister to seek to tweak the laws, when the legislation in itself was sufficient.
“Even the best of legislation to counter a particular situation would remain an ornamental piece unless strict enforcement is carried out against offenders,” he told FMT.
“How many housing developers have been prosecuted under the new Section 18A (which came into effect in 2015) despite so many abandoned housing projects? We have not heard any at all reported in the media.”
Section 18A of the Housing Development (Control and Licensing) Act provides a maximum sentence of three years’ jail, a fine of not less than RM250,000 or both on developers who abandon their projects.
Last week, housing and local government minister Zuraida Kamaruddin said the law would be amended to deal with abandoned projects, with the current legislation only providing for developers to be blacklisted.
She also said the ministry would be setting up a fund to which developers must contribute a certain amount, before proceeding with a project. The fund would be used if the developer abandons the project.
But Chang was sceptical of the rehabilitation fund, questioning whether the cost of contributions that developers have to bear would lead to higher prices.
“Obviously, developers will not absorb the costs but will instead factor them into the sales price,” he said.
He said the law already provided authorities with wide-ranging powers to salvage any “sick and problematic projects” to prevent them from being abandoned, and the “symptoms” could be detected early if projects were monitored.
“The public has been relying on this Act and the enforcers to protect them in their quest for homeownership and many are fed-up with the lack of enforcement when problems surface.
“Lack of enforcement and monitoring weakens the provisions of the Act.
“Let’s face it, there is no solution to abandonment. We just have to prevent it from happening,” he said, adding that the ministry should cast safety nets and adopt pre-emptive measures to prevent housing projects from being abandoned.
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