PR1MA will not be governed under Housing Act. So we buy at own risk?
|January 13, 2016||Posted by Ann Khee under Property News|
This is a very important notice to current and future PR1MA home buyers. The report from The Sun Daily gave me a shock. Please read.
Property speculation still rife: HBA
PETALING JAYA (3 January 2016): There has been a lack of concrete measures by the government in tackling speculation in the property market as speculators are still acquiring multiple properties to be subsequently sold at huge profits with only minimal real property gains tax (RPGT), said National House Buyers Association (HBA) secretary-general Chang Kim Loong.
“As a result, property prices remain high and beyond reach for many Malaysians, especially young people just entering the work force and those starting a family. It (RPGT) was a blatant letdown to control a spiraling increase of house prices,” he told SunBiz in an email interview.
The increase in RPGT in Budget 2016 was revised from 10% to 15% for properties sold within two years and from 5% to 10% for properties sold between two and five years.
The association also expressed its concern over talks that the 1Malaysia Housing Programme (PR1MA) will not be governed under the Housing Development (Control & Licensing) Act, 1966 and its regulations.
Chang said if PR1MA is not governed under the Act, developers of PR1MA will not be regulated under the prevailing legislation and buyers will not be protected under the statutory sale and purchase agreements and will be unable to seek legal redress through the Tribunal for Home Buyers Claims.
“Why shouldn’t PR1MA be under the Ministry of Housing and Local Government? Has the government lost confidence in their own ministry or has lost faith in their effectiveness?
“We hope government can take strong measures to curb speculation and bring orderliness to the property sector rather than allow PR1MA be exploited,” he added.
Nevertheless, HBA supports the government’s move in amending the Housing Development (Control and Licensing) Act, saying it gives more protection to house buyers in the form of ‘criminalising abandoned housing projects’ and imposition of 3% as deposit to the controller of housing in the developer’s application for a developer’s licence.
“Another good move is the amendments to the Strata Titles Act which provides for delivery of vacant possession of stratified units together with the Certificate of Completion and Compliance and strata titles. Also, the enactment of the new Strata Management Bill is an excellent piece of legislation that provides comprehensive guidelines for the maintenance and management of strata properties,” said Chang.
As opposed to developers, Chang said the Build Then Sell (BTS) (10:90) system, which is mandatory from 2015, will significantly reduce home buyers’ risk of big financial loss and hardship arising from stalled, abandoned and shoddily constructed projects.
“More important, we hope the government will see through these events to their completion and allow these laws to come into force soonest. Also, we urge that a roadmap for BTS (10:90) be finalised so as to allow a ‘gradual phasing in’ instead of an abrupt change into BTS (10:90) when 2015 comes,” he added.
The Master Builders Association Malaysia, meanwhile, is calling for a quick implementation and award of mega projects such as the second mass rapid transit line for the Klang Valley as well as the Wawasan Merdeka, Tun Razak Exchange and River of Life projects in Kuala Lumpur this year, noting that bureaucracy can sometimes delay the physical implementation of projects.
“The outlook for the construction sector for 2016 will continue to be positive with the government and the private sector playing their respective roles,” said its president Matthew Tee.
“I am also sure everyone is very anxious to know the result of the upcoming general election, which would have a bearing on the status and implementation of government projects.”
But Tee is aware that the implementation of mega projects will worsen the shortage of skilled labour faced by the industry.
“Last year, the ultimate challenge faced by the industry was the shortage of skilled workforce which continues to be a problem (in 2016),” he added.
MBAM had previously appealed to the government to allow the construction sector to secure skilled workforce from more source countries.
Conclusion: We hope this aspect will be given proper attention by the government. Otherwise home buyers are buying at own risk, and these people are from lower income group, how much can they do if PR1MA housing projects gone wrong?