I REFER to the letter, “Build first, sell later,” (The Star, Dec 10).
For the information of Frustrated, the recent amendments to the housing development laws have already taken care of the “build-then-sell” concept by encouraging developers to adopt it.
Section 7A of the Housing Development (Control & Licensing) Act 1966, the new Regulation 11 (1A) of the Housing Development (Control & Licensing) Regulations 1989 and the new Regulation 1A of the Housing Development (Housing Development Account) Regulations 1991 now provide that a housing developer is not required to open and maintain a housing development account.
He is also exempted from adopting the statutory Schedule G or H sale and purchase agreement if, at the time of the sale of the property, the property has already been completed with the certificate of fitness for occupation (CFO) and a copy of which has also been forwarded to the buyer.
In other words, the Government is now telling the developers to sell completed units with CFOs or be prepared to face the full force of the law which has now become very much more stringent and consumer-oriented after the amendments.
With these amendments, the developers should now take heed of the government’s warning that they should only sell when they are ready to do so.
Frustrated’s proposal to increase the amount to be held back by the stakeholders by 10% to 15% is not fair to the developers as the current 5% is a fair amount to be held back in the event of defects to the property.
Any other more serious breaches of contract can be referred to the new Homebuyers Tribunal or to the courts if the amount claimed exceeds RM25,000.
Regarding the proposal to have the stakeholder’s money held by the bank instead of solicitors, may I assuage his fears that with the new amendments to Section 7A of the 1966 Act, money held by the stakeholders has been given similar protection as money held in the housing development account.
This means such money is not deemed to be part of the property of the developer if his company winds up or is under liquidation and it shall be vested in the official receiver.
With this positive note, it is hoped the interest of housebuyers like Frustrated will no longer be so easily compromised by interested parties.
In fact, this is the most major revamp of the housing laws since 1982 and Housing and Local Government Minister Datuk Seri Ong Ka Ting is to be congratulated for his determination in pushing through these new laws during his first term of office.
May I say that the principle for the housing industry to be adopted now is caveat venditor (let the sellers beware) instead of caveat emptor (let the buyers beware).