PETALING JAYA: The proposed "Option to Purchase" (OTP) clause under a new housing law could give homebuyers greater flexibility before signing a sale and purchase agreement, says the Real Estate and Housing Developers’ Association Malaysia (Rehda).
Its president Datuk Ho Hon Sang said the mechanism would allow prospective buyers to reconsider a purchase if their financial or personal circumstances change.
"While the mechanism has yet to be finalised and there are still many uncertainties about the clause, in principle, the OTP mechanism is beneficial in protecting those who intend to purchase a specific residential unit.
"At the same time, it provides them with an opportunity to reconsider their purchase decision should their circumstances change," he said in a statement on Wednesday (May 13).
Ho said the proposed mechanism could also help developers assess genuine market demand before entering into binding commitments or commencing construction works.
He added that developers would have the flexibility to withdraw from projects that may no longer be commercially or financially viable before an agreement is signed.
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Housing and Local Government Minister Nga Kor Ming had earlier proposed the OTP clause under the planned Real Property Development Act, which is expected to replace the Housing Development (Control and Licensing) Act 1966.
Ho said industry players hoped the ministry would continue engaging stakeholders in refining the framework and implementation details of the mechanism.
"The clause, however, must be clear, practical and fair in safeguarding the interests of both purchasers and developers," he said.
He added that the proposal could potentially help address longstanding concerns affecting the housing sector, including issues related to abandoned housing projects.
