Report: Penang low-cost home-buyers forced to pay extra by developers

GEORGE TOWN (Sept 5): Property buyers say that developers are making them pay between RM30,000 and RM90,000 extra in packaged deals for units under the low-cost housing scheme.

The Malay Mail reports that developers claim the additional payments were for renovation or carpark packages tied to each unit and could not be separated.

Buyers say they are told to take it or leave it, as the units would be offered to others.

One buyer, customer service coordinator, K. Letchemi, 45, was reported as saying that she had been offered a RM72,500 low-medium cost unit at Skyview Garden on Perak Road.

“The developer told me they are out of low-medium cost units and to take a RM180,000 unit but offered me a discount so the price I had to pay was RM162,000,” she said.

“We later found out that the unit we paid RM162,000 for is the same as the RM72,500 unit and now, even before we get to move in, they are charging maintenance fees of RM220 each month,” she said.

Retiree Y. Rosalind, 56, was also offered a low-cost unit of RM42,000 in Sungai Ara but then paid an additional RM35,000 for a carpark lot and RM34,000 for basic renovations to the unit.

“When we moved in two years ago, we were forced to engage their contractor for basic renovations to the unit and they charged us RM34,000. I had to spend my life savings on all that,” she said.

Y. Rosalind depends on monthly Socso payments due to medical conditions.

Mohd Hirwan Mokhtar, 32, paid RM130,000 for a low-medium cost unit in Mount Erskine when the original price was RM72,500.

“I was forced to take a corner unit which is the same size as the other units and they told me I had to pay extra so I had to pay RM130,000 for a low-medium cost house and this does not even include renovations,” he said.

The report states that other homebuyers purchasing low and low-medium cost units from developers in five projects in Tanjung Tokong, Tanjung Bungah, Sungai Ara, Jalan Perak and Jelutong have been affected by this issue.

CAP acting president Mohideen Abdul Kader was quoted as saying that this is a case of developers ripping off the low income group.

“The developers are forcing the buyers to pay between 40% and 70% of the cost of the unit just for carpark lots,” he said, adding that the developers allegedly charge another 40% to 70% for renovation packages that are worth a fraction of the sum charged.

Basic floor tiling cost the homebuyers between RM30,000 and RM50,000, he said.

CAP has received numerous complaints, and he urged the Penang state government to look into this issue of the potential abuse of the state’s low-cost housing policy.

“The state leaves it to the developers to do the sales of these units and turns a blind eye to the fact that developers are not selling the units at the low and low-medium cost prices.

“The state is fully aware of this and the housing department even said warnings have been issued to the developers but all these warnings have fallen on deaf ears,” he said.

He suggested that the state set a maximum price for carpark lots that was proportionate to the price of the housing units.

“Car parking facilities in high-rise buildings are a requirement by the state government, not a luxury item,” Mohideen said.

He also recommended that the government take over balloting for the units, and provide special consideration to applicants who were disabled or with medical conditions.

“The scope for the 30% compliance clause must be extended to include the signing of the sale and purchase agreements at the controlled prices and be carried out by the state housing department so that developers cannot resort to arm-twisting tactics.

“The only way to stop the exploitation and bullying of low and low-medium cost house buyers is to make sure that everyone offered a unit by the state signs the sales and purchase agreement under the eyes of the state housing department,” he said.

Penang has a compliance clause imposed on housing developers requiring 30% of housing units built by developers be low-cost units priced at RM42,000 and low-medium cost units priced at RM72,500.