5% discount may be removed

BUMIPUTRAS in Selangor may not be given the 5% discount for high-end properties as the state government feels that the rich do not need the reduction.

State housing, building management and squatters committee chairman Iskandar Abdul Samad said under the guidelines drafted those who could afford houses worth RM2.5mil and above were rich enough and did not need the discount.

“We have bumiputras who are unable to own a house. These people need help and our aim is to abolish the discount enjoyed by the rich and give it to those earning less. It is still an option and has not been made a policy,” he said.

Recently, the Pakatan-led Selangor government began drafting guidelines where it plans to review the bumiputra quota for properties, as unsold bumiputra units are said to be a heavy burden on property developers.

Mentri Besar Tan Sri Abdul Khalid Ibrahim has held three meetings with the state government administrative heads, a private project consultant, an architect and Real Estate and Housing Developers Association (Rehda) Selangor Chapter chairman Ngian Siew Siong and Iskandar to come out with proposals and counter proposals on the guidelines.

Iskandar said in the last meeting on Jan 19, the state government had proposed to Rehda that the state would allow developers to sell bumiputra quota lots to non-bumiputras in stages based on the progress of work at the development site.

“We have come out with a plan after discussions with Rehda, allowing developers who have completed 50% of the work at the site to sell 10% of the bumiputra lots. If work had progressed to 75% than 20% is allowed.”

“Developers who had completed the project and obtained the certificate of fitness (CF) than 50% of lots could be sold. For projects after a six-month completion period with CF, the developers could sell all the bumiputra units,” said Iskandar.

All applications to release the bumiputra quota units would go through a special housing committee made up of the Selangor Housing and Real Estate Board (LPHS), Selangor Land and Minerals Department, land office and local council in the respective district that is chaired by Iskandar.

He added that before the bumiputra lots could be released, a clause in the guidelines required the developer to sell off the non-bumiputra units.

Iskandar said even before the release was given to sell the bumiputra lots to non-bumiputras, the state would make attempts to market the units under newly-formed business arm Syarikat Perumahaan and Hartanah Selangor Sdn Bhd.

“We will help the developers to sell the units. Our aim is to ensure the units are without buyers before giving the waiver as we want to protect bumiputra purchasers,” he said.

Iskandar added that Rehda wanted an automatic release but it could not be done as the clauses ensure control.

“Once the bumiputra quota units are released for sale to non-bumiputras, the 7% the developers earn from each unit has to be channelled to a special housing fund that would be managed by the state. We would use the money to help the poor Malays buy houses,” he said.

Iskandar also said Selangor was strict with developers and would impose a 5% fine on top of the 7% for housing and 10% for commercial lots or factories, if developers were found to have sold the units to non-bumiputras without the approval of the state.

Rehda committee member Datuk Ng Seing Liong said the Pakatan government’s proposed guidelines was worse as the state wanted 7% earned from selling the units to non-bumiputras to be channelled to a state fund and if the state government company helped to market the bumiputra quota houses than 1% was charged.

“It’s ridiculous and unfair to squeeze money from developers. In fact, there must be an automatic release mechanism as soon as 50% of the construction of the project is completed.

“In my view, the 7% for bumiputra lots should be given to properties worth below RM500,000 only,” said Ng.

National Housebuyers Association (HBA) honorary secretary-general Chang Kim Loong said the bumiputra quota differed from district to district in Selangor and added that it must have uniformity and be consistent with regulations of the federal government property development.

“Selangor government has guidelines on having pre-selected the bumiputra units but this should not be done and there must be a mechanism to loosen the sale. If this is allowed it could lead to abuse and corruption,” he said.

Chang questioned whether LPHS’s proposal was to buy the unsold units at market price after the units were completed or while it was under construction.

“On Syarikat Perumahaan and Hartanah Selangor’s proposal to help market the unsold units with a 1% fee that is added to the 7% , he said it was unfair. adding that it should be a social responsibility and not aimed at making profits.”

Chang added that the state government was lumping the 1% additional cost to the developer and this was hidden cost that would be passed down to the non-bumiputras.

“While HBA is trying to come up with mechanisms to make houses affordable for young adults, additional rules like this will not help,” he said.