ZADC
Return of the mandatory BTS saga Return of the mandatory BTS saga
Share this on WhatsAppTHE  ON-AGAIN-OFF-AGAIN PROPOSED MANDATORY SYSTEM IS BEING RESURRECTED AND CHAMPIONED BY NEW KPKT BOSS ZURAIDA BY Roznah Abdul Jabbar After almost two... Return of the mandatory BTS saga
Booking.com

THE  ON-AGAIN-OFF-AGAIN PROPOSED MANDATORY SYSTEM IS BEING RESURRECTED AND CHAMPIONED BY NEW KPKT BOSS ZURAIDA

BY Roznah Abdul Jabbar

After almost two decades of discussions, debates and flip-flops on legislation, the matter of implementing a mandatory build-then-sell (BTS) system could be back on the plan.

Last week, the Ministry of Housing and Local Government (KPKT) announced that the implementation of the system as a primary method of housing delivery would once again be pushed forward.

The announcement, made by KPKT minister Zuraida Kamaruddin has been well received by those who have long-championed the move as a more just and responsible system.

KPKT Minister Zuraida Kamaruddin revives mandatory implementation of BTS.

Among the most enthusiastic proponents of the BTS method is the National House Buyers Association (HBA).

HBA Honorary Secretary-General, Chang Kim Loong said, the move would be good news for house buyers, who for years have been pleading for this system to be adopted in order to put some orderliness into the housing industry and to ease their nightmares brought about by abandoned housing projects.

However, he said that HBA hopes that the minister is aware of the variable options available under this system, and the difference between absolute BTS and BTS 10:90 system.

“There was a brief respite for the house buying rakyat in 2013, when the previous government announced that by 2015 the housing industry would migrate from the troublesome sell-then-build (STB) to the orderly system of BTS,” Chang said.

He explained that during that era, the BTS system was thoroughly studied by focus groups and it was decided that rather than an absolute BTS system, a hybrid BTS 10:90 system would be the best fit for the country.

However, despite promising signs, even that plan was halted abruptly following a cabinet reshuffle, with the new minister doing a 180-degree turn by announcing the plan would be shelved.

Chang says it is high time the country utilised a more responsible system of housing delivery.

Chang pointed out that the BTS system was also a key subject discussed at the Special Task Force (STF) for Revival of Abandoned Housing Project under the Chief Secretary, and industry representatives including bankers, NGOs and prominent academicians spent hours in deliberate meetings and forums.

“The final unanimous conclusion was that the Malaysian housing industry was ready to adopt and progress on to the BTS 10:90 system,” he said.

However, Chang said that only the Real Estate and Housing Developers’ Association (REHDA) objected the conclusion, “for obvious reasons”.

The HBA has said that developers have long been dependent on a system that allows them to receive the bulk of the cash up front, because it enables them to have easier access to funds earlier in development cycle.

However, this puts buyers in a poor and exposed position should the development company run into areas due to a bad economy, or if projects are ultimately abandoned. The BTS 10:90 system would police against such occurrences because only developers in stronger economic positions and ample existing funds would have the confidence to build projects.

Earlier, Chang said to offer better protection to active developers and to absorb any possible shocks to the industry, a “lead-in” timeline was proposed and decided upon by the STF.

“But alas, again, for some unknown reason, the lead-in time-line was never implemented and neither was the BTS 10:90 system,” he said.

“We went back to square one, and subsequently saw no point in attempting to reinvent the wheel and lobby the merits of BTS 10:90 system. It seemed meaningless when after a high-powered STF had so thoroughly deliberated on the subject, reached a positive conclusion, but still could not deliver a positive outcome,” he added.

Chang said HBA applauds the latest announcement by the minister, but he also hopes that this latest effort will be see its way through to the end, and that the newly-minted government will ensure that all housing projects adhere the BTS system.

Under the 10:90 system, buyers pay a 10 per cent downpayment upon signing the Sales and Purchase Agreement (SPA), and the remaining 90 per cent only after the completion.

 

Property 360 Online

Shares