MESRA RAKYAT, GO GREEN IN CONJUCTION WITH FUNDRAISING EVENT ORGANISED BY JKP ZONE 11 & 16

This event has been successfully carried out on 22 September, 2013 from 8am until 10pm.

More than 5 thousand of the people from all over Puchong came support this event.

Lots of activities have been carried out for the whole day with numerous stalls selling foods and drinks.

This event has been supported by MP Puchong YB Tuan Gobind Singh, ADN Sri Serdang YB Puan Noor Hanim , ADN Kinrara YB Tuan Ng Sze Han, MP Seputeh Pn Teresa Kok and MP Serdang YB Dr. Ong Kian Ming.

Event starts off with a Zumba Warm out by Gorgeous Fitness Instructor…….

In the morning, Mesra Rakyat, which is the Q & A session between the communities and MPSJ has been carried out successfully where the people have been voicing out their concerns and suggestions contributively and amicably.  This definitely will help MPSJ in improving their services.

As to inaugurate the Go Green Puchong, YB Ng Sze Han, YB Noor Hanim and YB Teresa Kok were invited to Plant a Tree together-with the Chairman/Councilor Mr. Chang Kim Loong AMN,  Mr. Chik Chan Chee (Vice Chairman) and Ms. Alice Choo (Secretary) of JKP 16.  Cr. Pooi Weng Keong could not make to join this eventful activity as he has another important invitation at the same time.

The day was covered with all kind of activities throughout the whole day for children and teenagers.

There were Tanglung Contest, Drawing & Coloring Contest, Eating Contest and Basketball Tournament for different age groups.

Interestingly children have to make their tanglungs with given recycle materials hence this no doubt has given them a chance to instill and to inject their imaginations and creativity. 

Astoundingly many youngsters participated in the basketball tournament instead of idling around the house during the weekend.

The ambiance in the evening  was boosted up with the speed eating contest and talented kids performances organized by Master English who was one of the Main Sponsor of this particular event, whereas MBSB were the main organizer/sponsor for the drawing and coloring contest.   All winners were given cash prizes ranging from Rm 100 to Rm 50 plus cheeky hampers.

MP Serdang Dr. Ong Kian Ming whose schedule has been extremely tight also spared his time to support our event.  He is particularly impressed with Tzu Chi in building a Dialysis Centre in Penang to provide free medical services to the poor.  He is most glad if Rakyat can help in either a one time or monthly donations to Tzu Chi for them to complete this Dialysis Centre. 

YB Ng Sze Han and YB Teresa Kok personally contributed one unit of Lenovo Think Pad each as the grand prize for the lucky draw.

Apart from this, there are Rm 300 cash vouchers sponsored by Master English, Rm 799 worth of Land Packages for China by Malinja Tours, Rm 200 cash vouchers by Avalon, 3 months membership pass by Gorgeous Fitness, Rm 300 worth of Skincare products by WXY, Rm 100 worth of hamper by National Health Farm (NHF) and Rm 10,000 scholarship contributed by Asia Metropolitan University.

YB Ng is really a man with a great community heart returned at 8pm as a judge to all the contests and giving out prizes.

JKP Zone 11 and 16 are thankful to the 4 main sponsors namely Master English, Gorgeous Fitness, Avalon and Asia Metropolitan University as well as other sponsors likewise MPSJ,  IOI Properties, SP Setia, NHF, KMX, WXY beauty products and Malinja Tours and all the VIPs to have helped support this event that have allow us in managed to raise approximately Rm 7,000 which it will be donated to Dual Blessings, NKF and 5 anak yatims from Kg. Tengah.

This event is co-organized by Tenexpo Communication.

The Green Puchong Day 2013 In Conjuction with Mesra Rakyat

Event: The Green Puchong Day 2013 In Conjuction with Mesra Rakyat

Date: 22 Sept 2013 (Sunday)

Venue: Taman Tasik Wawasan, Pusat Bandar Puchong

Time: 7.30am to 9.30pm

Of speculators and bogus house buyers

taken from the Star:

http://www.starproperty.my/index.php/articles/property-news/of-speculators-and-bogus-house-buyers/

Of speculators and bogus house buyers

Posted on August 31, 2013 - Featured, Property News.

BUYERS BEWARE BY CHANG KIM LOONG

Immediate government measures are needed to tackle issue

“Harga Rumah Melampau” – that’s the desperate cry of the rakyat against skyrocketing house prices as headlined by one of the widely-read Bahasa Malaysia newspapers. In English, it translates to “House prices are ridiculous”.

The National House Buyers Association (HBA) has consistently called for government intervention to prevent a “homeless generation of young adult Malaysians” from emerging, especially in urban and sub-urban areas, who, if not for wild speculation, would be able to buy their own houses.

In time, Malaysia will face a “social crisis” with serious political implications if the majority of the lower and middle-income groups do not have affordable houses.

The matter is of grave urgency because the homeless hail from the lower middle class, usually graduate couples or the self-employed earning reasonable income and expecting to buy a house to commence their family life in a fixed abode.

In the Government’s drive to home ownership, low stamp duties have been imposed to encourage first-time house buyers to own a house.

But speculators have taken advantage of this to accumulate multiple properties and manipulate property prices with conniving cash-strapped housing developers. There are three types of purchasers, namely:

> Necessity: Those who buy out of need (owner-occupied),

> Precautionary: Those who buy to hedge against inflation and for long-term investment, and

> Speculative: Those who buy to “flip” and make money against everyone’s interest except their own.

This is a “ticking time bomb” and immediate government measures are needed. The government needs to take proactive measures to stop the steep rise in property prices due to false demand and excessive speculation fuelled by easy mortgages and the low Real Property Gains Tax or RPGT.

The less affluent, who constitute the majority of the population, have been marginalised, with those having more than others accumulating property far in excess of their needs. Urban Well Being, Housing and Local Government Minister DatukAbdul Rahman Dahlan in his keynote address at the recently concluded 16th Housing and Property Summit reiterated: “Of greater concern is the fact that income growth has not been keeping in tandem with the increase in house prices.
Data from the Department of Statistics Household Income Survey, 2012, shows that approximately 80% of Malaysians are earning below RM6,954 per month. Based on the credit line of 30% of the net income for housing loan, at the current Base lending Rate (BLR) of 6.60%, the maximum price of houses which can be afforded by this group (ie, 80% of the population) is only those costing RM300,000 and below.”

The question is: What are the impediments to the success of a truly affordable housing scheme for the people?

PR1MA

The 1Malaysia Housing Programme or PR1MA is an important targeted government initiative with the promise of an affordable home for every couple that deserves it. The government’s main contribution to ensuring affordability is its land, which is a significant subsidy. It is necessary for the organisation to have a clear criteria on these affordable homes.

Already, there are some disturbing signs that the initiative may be petering out even before implementation. PR1MA has already advertised its products at RM400,000 (from the earlier RM450,000 that I had heard about!). With government land being made available, these prices do not reflect the “subsidy” element and are beyond the reach of the intended income group.

It’s already priced too high for the majority of genuine house buyers. PR1MA is a noble idea, but is it being properly implemented? Are they building the right product, at the right place, with the right pricing and of the right numbers?

Even more unsettling is the invitation to private developers to build PRIMA homes and sell them under the PRIMA umbrella. Why? This adds a commercial profit element without any gain to the purchaser.

PR1MA will have to be a comprehensive and discrete regime in all aspects of house purchase; criteria for qualifying; build and sell; types of houses; the exclusion of commercial properties; the grievance redressal regime between purchaser and PR1MA; controls over sub-sale, and of course, appropriate sanctions for dishonesty in dealings with PR1MA.

Investors Club

The situation has been getting worse with the self-glorified “Investors Club” mushrooming in the housing market. They manipulate the property market through en-bloc purchases, say 100 to 200 parcels in stratified properties, with some nearly dominating 50% of housing units and commercial developments.

The modus operandi of the operators of such a club is to negotiate as block purchasers with cash-strapped developers and bargain for a pre-launch block discount of, say, 25% off the sales price. The operators then circulate amongst their members for a “bargain” early-bird discount of 15%, thus making themselves a 10% clean profit. The members of the Investors Club will subsequently dispose off their “wares” upon delivery of vacant possession at a further profit, especially in this current inflated property market.

Seminars like “How to become a billionaire” and “Invest in properties without deposits” will trigger young adults into thinking of shortcuts toward great riches.

Naive and greedy investors get enticed into such antics and are ready to be baited. You need to attend one of these seminars or conventions or whatever to understand more.

You could also surf the Internet and key in the word “Investors Club” to know their modus operandi and the names of the housing developers they are in alliance with and who participates in their “schemes”. There are instances when one needs to join as members at prices ranging from anything between RM300 and RM5,000 to enjoy a lifetime of free seminars and tips. Some are automatic members without having to pay.

There are different business models with some pooling their financial resources to buy bulk into a project, exiting together when prices go up and splitting the profits. It makes sense to developers who merely want to sell as many units as possible to attain the pre-requisite margin sales imposed by their banks or financial institutions (FIs) prior to the drawing down of their bridging loans.
Some banks or FIs impose a mandatory sale of 50% before loans are available for drawdown.

DIBS

In the developer interest-bearing scheme (DIBS), the developer bears the interest otherwise payable by the purchaser to the purchaser’s bank during the construction period. In other words, the purchaser doesn’t have to pay anything to his bank until construction is completed. The catch here is that the purchaser is committed to buying the house as in any Schedule G or H of the sale and purchase agreement. This is not a build-and-sell scheme although it is often passed off as such. The second catch is that the interest that the developer has been paying has actually been factored into the purchase price.

On top of this, should the project be abandoned, the purchaser would still be saddled with the purchase loan, the interest on it and an incomplete house.

In the event the developer cannot settle the loans he has taken, by charging the purchaser’s property, the purchaser’s house will be auctioned off.

The purchaser will still have to pay the loan he took, pay the interest and will not even have the incomplete house to look at!

DIBS is popular with speculators as they pay nothing to make a profit.

Their initial downpayment and deposits are sometimes factored into the purchase price by the participating developers, and some FIs do not even require that the developer collect the deposit that has to be paid by the so-called purchaser.

This is one of the factors making for “bogus” house buyers, who merely flip the property at the right time.

We hope that Bank Negara will come up with a policy change to curb DIBS. It is worth noting that Singapore had banned DIBS in 2009.

It has come to our attention that developers are already working on counteracting measures even before Bank Negara moves to implement anything.

After all, they are always one step ahead of the authorities.

Government initiatives and HBA’s proposals

The HBA was invited to present its 10 proposals to curb the escalation of house prices at the following recent forums: Budget Consultation, 2014 in Putrajaya chaired by the Prime Minister;
Providing Greater Access to Home Ownership chaired by the Deputy Minister of Finance II Datuk Seri Ahmad Husni Mohd Hanadzlah; and Initiatives to Reduce House Prices initiated by the Urban Wellbeing, Housing and Local Government Minister .

The government now seems to be serious about doing something. If it is so, then it has to make several hard decisions. The government must take immediate proactive steps to curb the uncontrolled escalation of property prices. Reducing speculation will translate into lower property prices.

HBA detailed proposals to raise stamp duties and the RPGT and the mechanism to lower the Loan-to-Value Ratio (LVR) as a means to stop price speculation, which has pushed property prices through the roof.

The three pertinent instruments amongst seven others that can be employed have been summarised in a table in the previous page.

Conclusion

Considering the deep pockets of property speculators, the effectiveness of these proposals remains to be seen, but, if passed, will make speculation unworthwhile.

> Chang Kim Loong is the secretary-general of the National House Buyers Association (HBA): www.hba.org.my, a non-profit, non-governmental organisation (NGO) manned by volunteers. He is also the NGO councillor at the Subang Jaya Municipality Council.

Have a green day in Puchong

taken from: http://www.thestar.com.my/News/Community/2013/08/20/Have-a-green-day-in-Puchong-Residents-Committee-to-organise-charity-event-on-Sept-22-to-build-close.aspx

BY OH ING YEEN 

INGYEEN@THESTAR.COM.MY

One for the album: (from left) Tenexpo Communication marketing manager Kino Ngiam, Zone 16 vice-chairman Chik Chan Chee (in blue), Dual Blessing Bhd volunteer team and public communication executive Goh Kuan Then, MPSJ councillor Chang Kim Loong, Masterskill deputy CEO Datuk Dr Jayles Yeoh, National Kidney Foundation of Malaysia CEO Chua Hong Wee and Zone 16 JKP committee member Mok W.O. with the posters of the event.

   

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DO YOUR bit for charity and Mother Nature while getting to know your community and local representatives at the Green Puchong Day on Sept 22.

The event will be held from 7.30am to 9.30pm at Taman Tasik Wawasan Puchong.

Organised by the Zone 16 Council Residents Committee, the objective is to create a platform for residents to give feedback for the betterment of MPSJ, to foster unity as well as build a friendly and conducive living environment in line with the motto “Towards Community Bonding”.

According to MPSJ councillor for Zone 16 Chang Kim Loong, last year’s event was well received.

“There will be a Q&A session by representatives from MPSJ’s infrastructure, landscape, engineering and enforcement departments.

“We will also be inviting Puchong MP Gobind Singh Deo, Kinrara assemblyman Ng Sze Han, Seri Serdang assemblyman Noor Hanim Ismail and Seputeh MP Teresa Kok, who is also the former Kinrara assemblyman,” he said at a press conference.

There will also be 10 scholarship awards from Asia Metropolitan University (AMU) up for grabs, food and beverage stalls as well as games and sports activities,

RM10 or RM20 vouchers can be purchased to buy food and drinks or participate in the games.

RM2 of every RM10 and RM4 of every RM20 voucher will be donated to the National Kidney Foun-dation, Dual Blessing Bhd and other selected NGOs.

Residents are also encouraged to bring recyclables or unwant- ed items such as T-shirts and aluminium cans.

There will also be a lantern walk at night.

For details, visit www.facebook.com/TheGreenPuchong- Day or call 017-991 0612, 017-991 0613.

MPSJ : Online tracking system proposed to track complaints

Taken from the Star:
http://www.thestar.com.my/News/Community/2013/08/05/Online-tracking-system-proposed.aspx

Published: Monday August 5, 2013 MYT 12:00:00 AM 
Updated: Monday August 5, 2013 MYT 7:12:11 AM

BY KATHLEEN MICHAEL
KATHLEEN@THESTAR.COM.MY

IN A bid to keep Subang Jaya residents updated on complaints made, Subang Jaya Municipal Council (MPSJ) councillor Chang Kim Loong has suggested that the council set up a system to track complaints.

Currently, complaints are made online through the e-aduan system, where complainants are requested to fill in their name, address, phone number and identity card number, and then lodge a complaint in not more than 500 words.

Chang, during the full board meeting recently, said it would be good to have a system that helped the public track their complaints online and be kept updated on the status of their complaints.

He said when complaints were made, they were forwarded to the respective departments to handle and the complainant was left in the dark.

MPSJ’s current time-frame to act on complaints is less than 14 days from the date it is received by the relevant officials.

“This new service will give residents peace of mind, knowing that their complaint has been received and is being looked into,” said Chang, adding that the council must also ensure details on complaints and its status were constantly updated.

Councillor Dr Loi Kheng Min is in agreement with Chang, and suggests that MPSJ implements FixMyStreet, an application introduced in the United Kingdom.

FixMyStreet is a place for residents to report, view and discuss problems in their residential areas. It acts as a platform for reporting facilities that are broken, dirty, damaged and in need of fixing or cleaning.

Complaints on potholes, faulty streetlights, burst water pipes and waste left uncollected are some of the other matters that can be uploaded.

For this innovative approach, residents need only take a picture of a problem in their neighbourhood and upload it on the application, and it will reach their local councils.

Loi said as a pilot project, the application could be made available to a few residential areas.

When contacted, MPSJ president Datuk Asmawi Kasbi said he would leave it to the council’s Information Technology Department to look into the proposals.

Can the developer confiscate your booking fee?

http://biz.thestar.com.my/news/story.asp?file=/2013/5/4/business/13046775&sec=business

Can the developer confiscate your booking fee?
BUYERS BEWARE
By CHANG KIM LOONG

I found my dream house. The developer's office said the project was selling like hot cakes. Sales were on a first come first serve basis' and I must pay a deposit otherwise she would have to give it to someone else. Or was it a booking fee she called it?

I begged her to give me one week. Three days, she said. How very sweet and understanding of her. Bank loan? No problem... 85% loan margin? No problem, she assured me. If I could not get a housing loan I could always cancel and get my money back. I left the developer's office feeling on top of the world. I had secured my dream house by paying the deposit. My dream turned into a nightmare when I could not get a bank loan. I had no choice but to forgo the house.

As if letting go of my dream was not bad enough, the developer now refuses to give me back my deposit. The lady said her hands were tight because it's a management decision. It was not stated in the option letter' or booking form' that my purchase was subject to the loan approval. On reading the terms and conditions in the option letter/booking form, I now realised that all terms were inclined in favour of the developer.

What do I do? I just want my money back. I don't mind if they keep a small sum for cost of paper work and for administrative purposes.

The above scenario is not at all uncommon.

Many house buyers are unaware of lending guidelines requiring loans to be tagged to net income as opposed to gross income. Many find that they are unable to obtain the financing they want and have to withdraw from an intended purchase before the sale and purchase agreement is even signed. The developer then refuses to refund the deposit or booking fee or whatever other payment which may have already been paid.

The unfortunate part about this whole thing is that house buyers do not have the luxury of a learning curve in which they can acquire the necessary skills to avoid getting themselves into trouble. Very often by the time they realised that they have made a mistake, it is already too late and the result can be traumatic and financially crippling.

This very noble and seemingly simple undertaking of buying a house, in a lot of cases, have gone terribly wrong.

Can developers collect booking fee or deposit?

The sale and purchase agreement (Schedule G, H, I or J) as prescribed by the Housing Development (Control and Licensing) Regulations, 1989 (the Housing Regulations) provides very clearly how the purchase price is to be paid. The first 10% is payable immediately upon the signing of the sale and purchase agreement (SPA), not before.

No collection of any payment is allowed before the SPA is signed. Deposit, booking fee, advance payment, administration charges are just some of terms used by some devious developers in their vain attempts to circumvent or contract out of the Housing Regulations and to confuse, mislead and convince nave house buyers especially the first-timers.

Collection of any payment by a housing developer before the signing of the SPA is an offence. This is very clear under the Housing Regulations and it does not matter what the developer calls it.

The Housing Regulation 11(2) stated: “No housing developer shall collect any payment by whatever name called except as prescribed by the contract of sale”. (In this context' contract of sale means the SPA)
Commission of such an offence under the Housing Regulations means that the developer in question can be prosecuted, fined and/or even imprisoned under Regulations 13. Even those persons who knowingly and willfully aids, abets, counsel, procures or commands the commission of such an offence shall be liable to be punished.

Prosecution, however, is in the hands of the public prosecutor whose action or non-action the house buyers are not able to dictate. House buyers and indeed the general public are of course at liberty to lodge a complaint against any developer in breach of any housing laws. Such complaints can be lodged with the Enforcement Division of the Ministry of Housing and Local Government: www.kpkt.gov.my

The law as regards non-payment before the signing of the SPA is very clear and house buyers are strongly urged to understand the law and not be misled by some cunning, unscrupulous developers or their smooth talking sales representatives who either do not know the law or simply do not care about the law.

Profit orientated developers care about nothing but profit. The more they sell the more they gain. They engage marketing commission agents and sales representatives whose only mission is to sell. In their quest to sell their products, some unprincipled commission agents (secondary markets included), who are untruthful will not hesitate to mislead, conveniently telling “white lies” and make empty promises to make a quick buck. Some are so well trained in the art of selling they can probably sell sand to the man in the desert.

Ever wondered why the sales office told you there are only five units left but three months later there are more than 10 units still available? Did the developer's office tell you the unit you want is already booked but called you two days later to congratulate you because the same unit has just become available? Ever gone to a developer's office in the hope of getting the “Early Bird Discount” advertised the day before only to find that the project was launched more than a year ago?

Filing a claim for refund
Free gifts, rebates, and waivers of this or that are also fairly commonly seen and are often stated to be for a limited time only. House buyers hurry to meet the deadline. Three months later the same advertisement appears, again for a limited time only or perhaps extended due to popular demand. Gimmicks of “Free legal fees” offer but you must use the developer's panel lawyers are commonly marketed.

The list of marketing ploys used by developers and their marketing alliance goes on and unscrupulous developers and real estate agents are not likely to stop trying to exploit vulnerable house buyers any time soon. House buyers must therefore be very wary and not be easily swayed by promises made by the developer's office.

House buyers who are already caught in tussles with housing developers over refund of booking fee or deposit are at liberty to file their claims at the Tribunal for Homebuyer Claims (the Housing Tribunal). The Housing Tribunal was set up as an alternative forum for house buyers to save them the costs and hassle of fighting with housing developers in the civil courts.

The filing fee is only RM10; no lawyers are required and hearings are normally fixed within a month. The Housing Tribunal is empowered to hear disputes between house buyers and licensed housing developers even though the SPA is yet to be signed but the claims must be filed within the time frames provided under section 16N of the Housing Development (Control & Licensing) Act 1966 (the HDA). Check out the link:www.kpkt.gov.my TTPR

Can the developer forfeit such payment?
Where booking fee or deposit or any other payment is collected by the developer before the SPA is signed, the house buyer would normally have been asked to sign a document indicating the house/apartment/condominium he/she is interested and agreeing to sign the SPA within a certain time frame, say 7 or 10 days or upon notice from the developer. This document may be in the form of an option letter, letter of offer, sales proforma, booking form or another document by whatever name the developer chooses to call it, all in an attempt to disguise a collection prohibited by law.

The amount varies and in some cases it is as much as 2% of the purchase price RM10,000 for a RM500,000 house. When the house buyer decides to withdraw from the intended purchase, the developer refuses to refund the deposit, or was it booking fee, or was it ...?

Chang Kim Loong is the honorary secretary-general of the National House Buyers Association: www.hba.org.my, a non-profit, non-governmental organisation manned by volunteers. He is also a NGO councillor at the Subang Jaya Municipality Council.

Points to consider when buying a house to avoid future complications

http://biz.thestar.com.my/news/story.asp?file=/2012/8/25/business/11910883&sec=business

Points to consider when buying a house to avoid future complications
BUYERS BEWARE
By CHANG KIM LOONG

CAN you afford a house now?

Assuming you can afford a house, how much can you afford to pay? These are important questions that many people do not research. This oversight can lead many people to bad debt and even bankruptcy.
Your monthly expenditures will be more than just the housing loan. There will also be insurance, electricity, water, telephone bills, contributions to maintenance fund, medical bills, groceries, unexpected household/auto repairs, lunch money and many other obligations.

They must all be accounted for in your budget spreadsheet. For many of us the purchase of a house or property is the largest financial commitment we will ever make. This makes arranging the most suitable housing loan just as important.

Make sure you know the costs of entering into the loan for the purchase of the property. They include conveyancing, application fees, valuation and legal fees, mortgage insurance (if necessary) and sometimes, extra life insurance premiums.

Some lenders will tell you the advantages of whatever housing loans they are trying to squeeze you into, but rarely will they tell you the disadvantages.

According to an article in a business magazine, the banking system is flush with RM180bil liquidity. This explains the increasingly aggressive sales promotions undertaken by financial institutions for the housing industry.

Always look at the total deal, not some dangling carrots in front of you. Compare the entire housing loan cost of different lenders to determine which is best for you.

I would like to discuss some of the lenders' offers that may not be as attractive as they appear. I will start with the special low interest offered for the first year. Such an offer is usually given during a sale campaign and it usually carries a fixed calendar period with a run-out date. Thus, even if a house buyer commenced his application process immediately upon the launch of the campaign, by the time the loan is approved and disbursement commences, the period remaining to enjoy this special low interest rate will certainly be less than one year.

If he were to start the application process a few months after the campaign, it is likely that he will enjoy the special low rate for only a very short period.

Due to our unique system of progressive payments to the developers, the mean average of the amount disbursed by the banks during the “first year low interest offer,” is really lower than the loan amount. Thus, any saving on interests is really much less than it seems. And these have all been figured out already by those marketing experts in the banks.

A more sincere approach would be to offer the special low interest rate to apply during the progressive payment period and to continue to run for one year after the date when the loan is fully disbursed. Only then can such offers bear some element of sincerity. I believe that anything short of that makes the offer a sales marketing gimmick.

There are other clauses that put house buyers in a disadvantaged situation. Some lenders include clauses in the loan agreements that give them the absolute rights to alter both the Base Lending Rates and/or the margin of interests.

Doesn't this in effect nullify their typical attractive offer of “BLR plus X% for following years?”
One cannot make a special low interest offer in the sales campaign and then contractually (through the loan agreement) creates a clause to allow that special offer interest rate to be invalidated. Make sure you know all the costs of early discharge of the loan.

One other clause to look out for is the redemption of the loan. A house buyer may wish to sell the house and wished to fully-settle the loan.

This is where the conditions for full-settlement differ from one financial institution to another. Think long term.
When one takes a loan, one spends a much longer period servicing the loan beyond the first year or even the second and the third year. So do not be taken in by the very attractive offers during the honeymoon year/s of the tenure of your loan. Remember, the remaining of the 25 years is more important. Do not go for short-term gains only to lose out heavily on the long remaining years.

I would advise house buyers to look beyond the first year of so-called low interest when shopping for housing loans. With the stiff competition among the various lenders today, one should seriously shop around and scrutinise each and every offer before commencing the application process. Talk to your bankers, lawyer friends or seek advice from the National House Buyers Association.

One really has to scrutinise the fine print before making a decision as to which financial institution to go to for a loan. It is about time to standardisde the terms and conditions in the loan agreement so that there will be orderliness in the banking industry.

No more “embedded” clauses within the voluminous stakes of papers one has to initial giving the impression that one has truly read and understood them. It is obviously impossible to read and understand those 40 over pages of legal language that comes with appendixes.

Chang Kim Loong is the honorary secretary-general of The National House Buyers Association, a non-profit, non-governmental, non-political organisation manned by volunteers. For more information, check www.hba.org.my or e-mail info@hba.org.my

Be forewarned: Do not sign your rights away

http://biz.thestar.com.my/news/story.asp?file=/2013/3/30/business/12890598&sec=business

Be forewarned: Do not sign your rights away
BUYERS BEWARE
By CHANG KIM LOONG

“THE developer says I must sign the letter to collect the keys.”

How often do we hear that from house buyers? Too often. How often do house buyers know what to do when faced with such dilemma when taking vacant possession? Not often enough. Do you know the entire content of the letter that you are asked to sign? Not really. Are the content too confusing and legalistic? Ehh Conclusion: Guess there is too much pride to admit that they are ignorant. The worst affected ones are the nave and unwary first-time house buyers.

When completion of a house is delayed, the developer must pay compensation or liquidated damages, commonly referred to as LAD (liquidated ascertained damages) to the house buyer. This LAD is calculated at 10% per annum on the purchase price for the period of delay in handing over the house.

Developers (unscrupulous ones) are known to have resorted to various ways and means to avoid paying LAD and these include misleading house buyers into signing waiver letters before handing over the keys to the house buyers. Some even resort to refusing to hand over the house keys unless the house buyers sign such waiver letters. What are house buyers to do?

First of all, house buyers must know their rights, benefits and entitlement. Secondly, they must not sign their rights away.

The developer must hand over the keys to the house buyers when the house is completed and ready for delivery of vacant possession. Buyers will be asked to sign a letter when collecting their keys. What house buyers must know is that this letter for collection of keys should contain nothing more than an acknowledgement by the buyer that he has collected the keys and a confirmation as to how many sets of keys are given. This letter must not contain any terms or conditions that the buyer waives LAD or other rights, benefits and entitlement under the sale and purchase agreement (SPA) or that the buyer will not make any claim whatsoever against the developer.

HD Act and its governing regulations
Under the Housing Development (Control and Licensing) Regulations 1989 (HDR) [which are regulations made under the Housing Development (Control and Licensing) Act 1966 (HDA)], the sale and purchase agreement (SPA) for any housing accommodation sold by a housing developer must be in the format prescribed under the HDR. This SPA, unlike any other contract of sale, contains provisions which cannot be changed at all unless such changes have been sanctioned by the Controller of Housing at the Housing and Local Government Ministry (MOH). In other words, this SPA is a statutory contract and all the provisions in this SPA are statutory requirements which must be strictly complied with.

One of the provisions of the SPA gives the house buyer a right to be paid LAD immediately by the developer in the event of delay in the completion of the housing accommodation. It is found in Clause 22(2) of Schedule G and the corresponding Clause 25(2) of Schedule H - Sale & Purchase Agreement.
Can this statutory right be waived by the house buyer? According to the Federal Court, the answer lies in the overall purpose of the legislations and whether this purpose would be defeated by permitting waiver and contracting out.

There is no shortage of cases whereby the Courts of Law have decided that the housing legislations are a social legislation, the main purpose of which is to protect the interest of house buyers. And, according to the Federal Court, the protection given to house buyers under the HDA and HDR is not just a private right but a matter of public interest. Such court decisions have even received affirmation and endorsement by Parliament in 2007 when it amended the long title to the HDA to read as “An Act to provide for ... the protection of the interest of purchasers... ”

If statutory rights given to house buyers could be waived by them individually, surely the good and commendable intention of parliament to provide the much-needed protection for house buyers (and indeed the whole purpose of the housing legislations) would be defeated and eroded.

The conclusion is therefore clear and simple. Waiver letters are not worth the paper they are written on. They cannot be held against the house buyers and must be declared null and void. Developers must be made to stop trying to wriggle their way out of paying LAD. They must accept that the only way they can escape liability to pay LAD is for them to secure a certificate from the Controller of Housing extending the delivery date.

Word of caution
House buyers are strongly cautioned not to sign waiver letters to avoid possible undesired delay(s) or outcome in their claims and unnecessary legal battles with unscrupulous developers who will raise whatever issues possible to avoid or simply delay the legitimate claims from the house buyers.

“But what can I do if the letter contains a waiver? I don't have a choice. I want my keys and the developer says I must sign then only can give me the keys.”

Sign “Under Protest” is one way. The house buyer can write a note on the letter that he does not agree to waive LAD, or that he does not agree to waive his rights, or that it is “Without Prejudice” to his/ her rights under the SPA. Alternatively, he can delete the offending words or sentences.

If the developer refuses to give the keys unless the house buyer signs without adding or deleting anything from the letter, the house buyer are constrained to sign and collect the keys but should immediately after that write to the developer to state that he was not given a choice but was “arm-twisted” and that he does not agree to waive LAD or other rights. A complaint should be immediately lodged with the Enforcement Division of the Housing Ministry (www.kpkt.gov.my ) and a claim can be filed at the Housing Tribunal, both of which should be done expeditiously.

Tribunal for Home Buyer Claims: www.kpkt.gov.my Portal TTPR)
The Tribunal for Home Buyer Claims, commonly known as the Housing Tribunal, is empowered to deal with house buyers' claims against developers and can give awards up to RM50,000. Its awards can be enforced against developers just like a judgment from a Court of Law. In addition, non-compliance of its awards is an offence and the defiant developer can be prosecuted.

Even though its head office is in Putrajaya, the Housing Tribunal has branches in Johor Baru, Seberang Prai as well as Kuala Terengganu. It conducts court hearings, not just in Putrajaya and its branches, but also many other localities for the convenience of house buyers. The filing fee is RM10 and no lawyers are required. It has been set up for the benefit of house buyers. It is cheap, fast and easy, so make use of it.
Even though I take the view that a waiver of rights and benefits under the SPA by any house buyer is void and cannot be enforced, house buyers are strongly advised to avoid signing any such waiver letter to avoid undesired outcome to their claims.

House buyers are cautioned to exercise prudence when dealing with such shrewd and unscrupulous housing developers who have no principles. Avoid buying property from those developers who have such unprincipled track record.

Chang Kim Loong is the honorary secretary-general of the National House Buyers Association (www.hba.org.my), a non-profit, non-governmental organisation manned by volunteers. He is also a councillor at the Municipal Council of Subang Jaya.

House-buyers beware of DIBS

http://archives.thestar.com.my/services/printerfriendly.asp?file=/2012/12/22/business/12472840.asp&sec=business

Buyers Beware
By CHANG KIM LOONG

OF late, there have been a few housing developers who proudly advertise that the sales of their product are offered are with “interests payment borne by developers”. Such schemes are known as DIBS, that is developers' interest-bearing scheme.

A particular one even boldly states that house-buyers make no payment until due vacant possession of the said houses.

It entices potential house-buyers that all they need is to pay the requisite downpayment of 10% upon signing the sales and purchase agreement (SPA) and the balance thereof will be financed by their panel banks/financial institutions.

Some even have the audacity to equate the same with the 10:90 concept of built-then-sell (BTS). One even goes as far as to advertise the mode of payment as 5:95 model. The connotations in all these advertisements are that buyers do not make any progressive payments until the houses are completed and ready for vacant possession.

All these advertised “schemes” of payments are nothing more than loan packages. Although the advertisement states “no payment until vacant possession”, in reality the buyers' loans are “locked-in” with panel banks/financial institutions and hence, buyers' housing loans are used to pay the developers as they construct the houses.

It is based exactly on the current sell-then-build (STB) or progressive payment formula. This formula has got so many house-buyers into trouble when the houses they buy are abandoned by the developers.
The only difference in the advertised system is that the interests towards the progressive payments are shouldered, absorbed and borne by the developers. Buyers still have to secure their end-financing housing loans as soon as they sign the SPA. Buyers are still responsible to the banks and financial institutions for the loans whether the houses are delivered or not.

BTS 10:90 model
This is far different from the real BTS 10:90 concept put in place and encouraged by the Government, whereby the buyers truly do not make any payment except for the deposit of 10% until vacant possession because the end-financing loans do not kick in until the houses are completed with all the certifications obtained and keys with vacant possession are available.

It is a far safer mode of buying houses and this is precisely why the Government is encouraging it and furthermore offering incentives to developers who opt to adopt this mode of selling their products. But it fell short of compelling the industry to adopt this BTS 10:90 concept currently. However, the Housing and Local Government Minister has reiterated that the BTS 10:90 will be made mandatory by 2015.


Vital differences
The vital difference between the advertised DIBS abbreviation and the government-encouraged BTS 10:90 is that, in the advertised DIBS or 10:90 or 5:95 model, should the developer abandon the project (for whatever reason), buyers are left with a partially disbursed housing loan to settle.

The amount varies in accordance with the amount of disbursements made.

The primary borrower is still the buyers and that it is the sole responsibility of the borrowers/buyers to continue with the proper conduct of his loan from the financiers.

Banks have not been known to be sympathetic to victims of abandoned projects.

The loans still have to be settled house or no house! This is the predicament presently faced by tens of thousands of nave and innocent buyers when the houses that they had bought were abandoned by their developers.

Don't think for a minute that the financier will write off the loan payable by the borrower/buyer.

Thus, the various advertisements for DIBS abbreviation or 10:90 or 5:95 or 0:100 connotations are merely marketing tools and are not the same as the BTS 10:90 concept that is put in place under the Housing Development (Control and Licensing) Act and Regulations.

These advertisements are open to misunderstanding and confusion. In this period of soft market in the housing industry, it is natural that more and more innovative sales strategy will come in.

We are not in opposition to that, but we are of the stand that advertisements should not have any element of misrepresentation or misconception and should not give rise to misunderstanding and confusion.


Housing Ministry to be vigilant
The Housing Ministry's Licensing Department should also take a close look at the contents of such advertisements before granting them sales and advertisement permits.

To allow such advertisements is injustice to nave and innocent first-time house-buyers.

Has the ministry erred in allowing those advertisements or did it not manage to spot the difference?

I would like to categorically state that I'm by no means implying that the advertised project is likely to be abandoned. This article is aimed only to inform potential buyers on the differences between the advertised DIBS or 10:90 or 5:95 or 0:100 mode of purchase vis-vis the government-encouraged BTS 10:90 concept.
Be an informed buyer and empower yourself with information to make a wise decision.


How to spot the difference
On the side of caution, the buyer needs to check if he has bought into a STB 10:90 loan package “scheme” or a BTS 10:90 concept. The differences between the two models are already explained in the article. An easy way to know what the buyer has bought is to refer to the SPA. If the contract is a Schedule H or Schedule G, the scheme is a sell-then-build. If the contract is a Schedule I or Schedule J, the scheme is a BTS 10:90 variant.


> Chang Kim Loong is the honorary secretary-general of The National House Buyers Association, a non-profit, non-governmental, non-political organisation manned by volunteers. For more information, click www.hba.org.my or e-mail info@hba.org.my