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New law to protect high-rise buyers

SUBANG JAYA: High-rise residential unit owners and developers will jointly manage buildings until the strata titles are issued, under a new law being planned by the Government.
Housing and Local Government Minister Datuk Seri Ong Ka Ting said the Common Properties and Buildings Management and Maintenance Act was needed to protect buyers before they receive strata titles.
Ong said buyers and developers would be required to open a joint account where all payments would be deposited. The account would be managed by a joint committee comprising representatives from the buyers and developers.
He added that if both parties still could not resolve their disputes this way, the Government would appoint a building commissioner who would take over the management of the funds and act as the middleman.
Ong said the proposed Act had been drafted and sent to the Attorney-General's Office for comments before being submitted to the Cabinet for approval.
He pointed out that the introduction of the new legislation had become imperative and necessary to address some of the issues and problems confronting the housing industry.

The Star - Wednesday 18/4/2001


Giving condo owners a say over fees for maintenance

BUYERS of condominium and apartment units will be able to decide on the rate of maintenance fees under the new Building and Common Property Bill to be tabled soon.
Deputy Housing and Local Government Minister Datuk M. Kayveas said at present only developers of condominium units were given the right to set maintenance fees.
"Under this Bill, a joint management body comprising developers and buyers will be set up to take over the management of the building.
"Through this body, both the buyers and developers can then decide the maintenance fees," he said in reply to Senator Jaya Partiban.
To a question from Datuk Dr Chin Fook Weng, Kayveas said condominium and apartment owners would still had to pay their assessment bills as these were collected by local councils.
"House assessments are paid for the maintenance of the areas outside the buildings while maintenance fees are confined to the common property in the condominium complex," he said.

The Star - 25/7/2001

Non-payment of maintenance and service fees a problem

NON-PAYMENT of maintenance and service charges by owners and dwellers of strata properties has developed into one big headache for property developers.
Real Estate and Housing Developers Association (REHDA) president Datuk Eddy Chen Lok Loi said non-payment of maintenance and service charges had become so rampant that in many schemes, half of the parcel owners had defaulted or did not pay at all. "As a result, there will not be enough funds to carry out the required day-to-day in maintenance and management, let alone provide for sinking fund and refurbishment activities," Chen said at a strata properties seminar in Kuala Lumpur yesterday.
He said the non-payment of fees and charges would not only affect the quality of the services provided but in turn irritate owners who had been paying dutifully.
"In no time at all, developers win be left in the lurch as owners who previously paid their dues will abstain from paying the maintenance charges, blaming poor maintenance services.
"This problem is even worse in low-medium and tow-cost schemes where parcel owners are really not in a position financially to fork out additional resources for maintenance charges," he added.
In 1993, the Housing Developers Association (HDA) conducted a survey of 30 developers with a total of 26,150 units of sub-divided dwellings on the status of arrears in maintenance fees which found that this totalled more than RM8.78million.
"By end-2000, there was a stock of 588,785 units of strata properties. Assuming that the floor area for these units is 850 sq ft, maintenance fees chargeable at 20 sen per sq ft and 50% of the total unit owners have defaulted for six months, total maintenance fees in arrears could easily total to over RM30milion

The Star - Wednesday - 18-4-2001

Bill proposes higher fines on maintenance-fee defaulters
By LIM AI LEE

PENANG: Owners of flats and other high-rise units who fail to pay maintenance fees to the management corporations involved may be fined up to RM5,000 under proposed amendments to the Strata Titles Act.
Offenders convicted in court also face a further daily fine of RM50 as long as the maintenance fee remains unpaid.
A new clause under Section 55Aof the proposed Act states that failure to pay contributions is an offence."
Copies of the Bill to be tabled in the current Parliamentary sitting have been distributed to MPs.
Another clause seeks to increase the fine imposed on developers whose application for subdivision of their buildings is not made within the specified period.
Offenders may be liable to a fine of between RM10,000 and RM100,000 and a daily fine of between RM100 and RM1,000 if the offence continues.
Currently, the fine does not exceed RM5,000 while the daily fine is not more than RMl,000
A spokesman for a property management firm here welcomed the penalty as it would encourage more people to settle their charges.
He said that fee collection was a major problem, adding mat the average collection rate was between 50% and 70%.

"ln some cases, the collection rate is only 30% which is not even sufficient to cover maintenance costs," he said, adding that those who defaulted included foreign owners and low-cost buyers.
Penang DAP treasurer Phee Boon Poh said the amendments could have far-reaching implications on housebuyers and should be reviewed together with the Housing Developers Act.
He cited a case in Penang where purchasers of a flat project were asked to pay maintenance charges following the handing over of vacant possession 10 years ago although the project had not received a Certificate of Fitness.
"Under such circumstances, it is unfair to compel housebuyers to pay charges when the buildings are not fit for occupation," he said, adding that there should be a provision that contributions should be imposed only after a project was issued with a Certificate of Fit.

The Star - Wednesday -11-4-2001
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