THE STAR. 7TH NOVEMBER: Bumiputra housing quotas should be based on actual demand data to prevent property overhang, says the Real Estate and Housing Developers Association Malaysia (Rehda).
Its president Datuk NK Tong (pic) said having a registration of potential eligible buyers could help guide the quota rather than imposing an across-the-board standard on all developers.
“Providing bumiputra lots is an obligation that developers have been performing for decades.
“However, land is a state matter and therefore not regulated by a central body like the Local Government Development Ministry, which has clear and robust guidelines.
“This is also the main reason why there is no standard or transparent mechanism of bumiputra lot release across all states,” he said in a statement.
Tong was commenting on a StarMetro report yesterday about Selangor property owners left in the lurch after being sold residential units meant for bumiputra buyers.
These homeowners are now saddled with penalty fees amounting to millions after the developers have gone into liquidation.
Tong said state governments and local authorities must publish and adhere to standard guidelines to administer, and have a transparent release mechanism for bumiputra lots.
For example, he said, some states allowed bumiputra waiver applications only after achieving 50% completion of construction; when all non-bumiputra quotas had been sold; or upon completion.
In some states, the bumiputra release comes in several tranches with intervals every six months, he said.
He stressed that despite the lack of a uniformed release mechanism, Rehda did not condone developers who tried to skirt the guidelines.
The association, said Tong, had submitted release mechanism proposals to the government.
“It must be noted that developers are not able to easily sell a bumi unit to a non-bumi, as ultimately the unit cannot be registered for transfer at the land office without a certificate of release from the state housing board.
“Buyers, whether bumi or non-bumi, are well protected under the law and regulations,” he said.
He added that in most states, developers were required to pay the state government for any bumiputra lots they wished to convert to non-bumiputra, which incurred additional costs to them.
Tong also touched on the property overhang caused by unsold bumiputra units.
“A big percentage of completed but unsold properties in the country are tied up in unreleased bumiputra lots.
“In some cases, these properties have been completed for years with evidence that the developers have fulfilled the necessary requirements for release such as placing advertisements and participating in property shows to promote the bumiputra units.
“These unsold units can cause cash flow problems that can lead to developers having late, sick or abandoned projects elsewhere in their portfolios,” he noted.
Tong said that as developers were unable to know when such units could be released for sale to others, they had to price in “holding costs” that made homes unnecessarily expensive for both bumiputra and non-bumiputra units.