Errant developers face jail and RM500,000 fine

PETALING JAYA: Errant housing developers can now be hit with hefty fines and jail terms if they abandon their projects.

Under the amendments to the National Housing Development (Control and Licensing) Act 1966, which would take effect from June, developers of abandoned projects may be fined RM500,000 and jailed for up to three years.

The changes also enable house buyers to terminate sale and purchase agreements with developers if there was no progress for six consecutive months or more and seek a refund of deposits within 30 days.

House Buyers Association secretary-general Chang Kim Loong said the changes offered house buyers more legal safeguards against errant housing developers.

He said it was a reflection of the Government’s concern for house buyers’ rights and a move to ensure that developers kept to their obligation of completing projects.

 

He commended former Urban Wellbeing, Housing and Local Government Minister Datuk Seri Chor Chee Heung for helping to pave the way for the amendments in 2010.

“The pertinent changes include making errant developers criminally liable by meting out jail sentences upon conviction.

“The new laws also enforces liquidators, as de-facto developers, to abide by the Act,” he said.

However, Chan said changes should also be made to other laws to further streamline the construction industry.

He said among the laws being reviewed where those pertaining to housing developers regulations and sale and purchase agreements under Schedule (G,H,I,J) together with the Strata Management Act, Strata Title Act and Strata Tribunal Act.

“Since all these laws relate to the welfare of house buyers and cross-reference each other, they should be launched simultaneously to avoid potential conflicting legal views,” he said.

Chan said the drafting process involving the amendments were nearing completion and that the changes were expected to be announced by the ministry.

On April 3, Deputy Urban Wellbeing, Housing and Local Government Minister Datuk Halimah Mohd Sadique announced to the Dewan Rakyat that the amendments to the Housing Development (Control and Licensing) would come into effect on June 1.

From 2009 to Feb 28 this year, the ministry had classified 206 housing projects as abandoned.

Out of these, 149 had since been revived with 22,868 homes built.