PETALING JAYA: Blacklisting housing developers is not the answer to all of their follies, as the compounds are but a fraction of their profits, say housing experts.
They also asked how many developers of abandoned housing projects have been taken to court under Section 18A of the Housing Development (Control & Licensing) Act 1966.
Under this law, a housing developer who refuses to continue, or has postponed or suspended or stopped, the projects for a period of six months or more can be guilty of an offence which carries the punishment of a fine of between RM250,000 to RM500,000, or imprisonment for up to three years, or both.
They were responding to the Housing and Local Government Ministry announcing that 109 developers and their boards of directors have been blacklisted for a myriad of offences.
Lawyer and secretary-general of the National House Buyers Association (HBA), Datuk Chang Kim Loong said laws should not be “mere ornamental pieces”.
“Since the enactment of Section 18A of HDA in 2015, there has not been any news of developers being prosecuted under this new Section, although cases of abandonment abound.
“The best legislation would remain as an ornamental piece unless strict enforcement is carried out against offenders.
“It is a traumatic experience having to endure a situation where you place your entire savings to own a home, only to discover the house never gets completed and, worse, you still have to service the bank loan,” said Chang.
He added that blacklisting directors of blacklisted developers does not stop them from establishing other entities.
“What is stopping these individuals from forming other companies using proxies?” said Chang, urging strict legal action against such developers and their directors.
Housing law expert Wong Hua Siong from the Malaysian Multimedia University in Melaka said the government has to educate homebuyers as there are many loopholes for “unscrupulous developers”.
“The question is to what extent does the law restrict or enforce agencies to check whether these directors will appoint any proxy or representative to run a new development company?
“In most cases I have studied, most of the directors will not pay the penalty.
“The government must keep reminding homebuyers to go for reputable developers.
“Be cautious of the ‘uncommon’ developer. For blacklisted developers, even when cleared from the list, the authority could impose stricter requirements on them to “build and sell”, rather than “sell and build”, said Wong.
