The property market is blooming with new developments of various price bracket. First time home buyers have ample of options in choosing their first home but buyers must be equipped with knowledge on the hows and whys of the property sector in order to avoid any unwanted hiccups.
The National House Buyers Association (HBA) secretary-general Chang Kim Loong has called on prospective house buyers to defer their acquisition plans until Urban Wellbeing, Housing, and Local Government minister Noh Omar has assured that he would no longer grant extensions of time (EOT) to developers, reported Malaysiakini.
He also urged house buyers to demand for developers to execute an irrevocable undertaking that they would not ask for EOTs from the ministry.
His statement came after minister Noh Omar revealed in parliament that he, and the controller of housing, had granted a total of 304 EOTs since 2014.
Chang noted that such move had resulted to uncertainty among house buyers.
“Because of that, perhaps intelligent house buyers should hold off on their purchase, meaning that we don’t buy first until certain things happen,” he said.
“Otherwise, where is my surety as a buyer? I can’t plan my time. Assuming a first-time house buyer who wants to get married – they thought their house should be ready in 36 months, but subsequently it got delayed by one year.”
And with the EOT, the house buyer cannot claim for any liquidated ascertained damages (LAD) for the delay, he added.
Notably, the LAD for the late delivery of housing units is equivalent to 10 percent of the acquisition price per annum based on the standard terms of a sale and purchase agreement (SPA).
Noh, on the other hand, had explained in parliament that the EOTs were granted to prevent projects from being abandoned; hence, protecting the interest of house buyers.
In dismissing such claims, Chang noted that buyers are not entitled to LAD until vacant possession of the property has been handed to them – negating the issue of abandonment.
He also disagreed with Noh when the latter said developers should be given EOTs in the event of landslides, floods or a stop-work order from the local council.
This is because such problems are usually self-inflicted – the developer had failed to build proper drainage at the project or had incurred the ire of local residents by working past the allowable working hours, resulting to a noise complaint, said Chang.
Among new homes available:
Image sourced from Malaysia Kini
Radin Ghazali, Content Writer at PropertyGuru, edited this story. To contact her about this or other stories email radin@propertyguru.com.my
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