Housing: Build-then-sell concept will not be implemented in 2015

PUTRAJAYA: The Urban Wellbeing, Housing and Local Government Ministry has decided that the plan to compel housing developers to adopt the concept of build-then-sell will not be implemented next year.

Its minister, Datuk Abdul Rahman Dahlan, said it was to prevent shortage of houses in the market, which will cause a hike in housing prices.

"Our study showed that if we compel housing developers to adopt the concept starting 2015, it will contribute to the hike in housing price, and the small-scale housing companies or developers will not be able to develop any project as they have to bear all the cost," he told a press conference after chairing the National Housing Committee meeting at his ministry Wednesday.

Abdul Rahman was commenting on the issue, which had become a hot topic of debate among developers and house buyers, following the announcement made by the former Housing and Local Government Minister Datuk Seri Chor Chee Heung that all housing developers would be compelled to adopt the build-then-sell concept starting 2015.

Under the concept, which aimed to stem the abandoning of housing projects, house buyer will only have to pay 10% deposit, while the balance of 90% would only be paid after the houses are completed.

Commenting further, Abdul Rahman said he had studied the Chor's speech regarding the matter, which he made in Parliament in 2012, and found that Chor has just said that the government was planning to introduce the build-then-sell system in 2015 if the time was right.

"...and right now, we are in the opinion that the time is not right for the concept to the implemented, especially with the Goods and Services Tax set to be imposed in April," he said.

The minister, however, said the ministry did not reject the concept, but would really encourage any housing developer to adopt the concept voluntarily.

"It's a marketing tool for them, we congratulate and propose they should continue with that, but it cannot be enforced yet because we fear that the price of houses will continue to go up," he added. - Bernama