Protect house buyers, says Akmal

In discussion: Akmal giving his response in Parliament. -Bernama

KUALA LUMPUR: Blacklisting developers behind abandoned housing or sick projects as well as introducing the “option to purchase” pre-sale agreements are among the proposals being studied to protect house buyers.

These proposals are being studied to strengthen the Housing Development (Control and Licensing) Act 1966 (Act 118).

Deputy Local Government Development Minister Akmal Nasrullah Nasir told the Dewan Rakyat yesterday that besides developers behind sick projects, those who failed to pay compounds, failed to heed awards by the Tribunal for Home Buyers Claims or developers without licence would also be blacklisted.

The developers will not be able to apply for developers’ licences nor advertising and sales permits, he added.

“The option to purchase a contract as a pre-sale agreement with detailed conditions will also be introduced,” he said during Question Time.

Akmal said the contract option would allow developers and house buyers the exit option without a high financial implication if the developer failed to proceed with the project due to being unable to hit the sales target within a certain period. Besides that, the proposed amendment also looks into ensuring that developers have good financial standing.

The proposed amendments, he said, would also entail clearer definitions of sick projects.

“At this juncture, the definition of an abandoned project is quite loose,” he said, adding that clearer definitions would enable more effective enforcement.

Akmal said improvements to the Act aimed to strengthen the administration and management of the housing sector efficiently.

The move was also to protect the rights and interests of homeowners and ensure the sustainability of the housing sector.

Other measures taken included the formation of the Task Force for Sick Private Housing Projects to monitor, gather facts and conduct due diligence on the best mechanism to resolve issues related to problematic projects. The task force would focus on four elements for its terms of reference, namely tracking, resolving, preventive and forward modelling.The government is also stepping up enforcement through existing procedures under the Housing Development Account, which all licensed private developers in Peninsular Malaysia are required to have.

Improvements were also made to the Housing Integrated Management System (HIMS) to ensure better monitoring of private developers.

Akmal was responding to Datuk Shamshulkahar Mohd Deli (BN- Jempol) who asked if there would be amendments to the Act to overcome the issue of sick projects and improve the efficiency of housing development.

In a supplementary question, Shamshulkahar also mooted an insurance scheme to protect home buyers against incomplete housing projects.

“To defend buyers, can the government consider an insurance scheme to guarantee the completion of housing projects to mitigate the issue of sick projects?” he asked.

Akmal responded that he was personally in favour of the idea.

“This is still new. I accept the proposal by Jempol for us to look into this matter to see if protection can be given in the form of insurance for projects that are under construction. If there are problems, there could be a safety net,” he added.