Issuance of strata titles with vacant possession failed due to lack of coordination between ministry, govt agencies — AG's Report

• The audit, which was carried out on the application and issuance of strata titles and strata management by the Commissioner of Building between 2020 to 2022, found that there were 419 schemes out of 3,049 schemes in the Federal Territories that still had not received their strata titles, which give house buyers full legal ownership of their properties, even though vacant possession had been issued.

KUALA LUMPUR (July 4): The government has failed to implement the simultaneous issuance of vacant possession with strata titles (VPST), as there was no coordination between the Ministry of Housing and Local Government (KPKT) and other government agencies to fulfill the implementation of the policy, according to the Auditor General’s (AG) Report 2024. 

The audit, which was carried out on the application and issuance of strata titles and strata management by the Commissioner of Building between 2020 to 2022, found that there were 419 schemes out of 3,049 schemes in the Federal Territories that still had not received their strata titles, which give house buyers full legal ownership of their properties, even though vacant possession had been issued. 

The policy for the simultaneous issuance of VPST came into effect on June 1, 2015. It mandated that developers must apply for the certificate of proposed strata plan (CPSP) within three months from the issuance of document that certifies the super structure (or from the issuance of the Certificate of Completion and Compliance and can be extended once by the Director of Survey for not more than one month. Developers must also apply for the subdivision of building within one month from the issuance of the CPSP (which can be extended by the Director of Survey by not more than one month), so that the strata titles should be ready upon vacant possession. However, house buyers have often complained that this was not the case. 

The delay with the issuance of the strata titles, according to the AG's Report, has caused strata homebuyers to be at risk of incurring increased transfer costs and the government bearing the fee to assist scheme owners. The transfer of ownership, mortgage and inheritance transactions were also affected due to this issue. 

In addition, the AG's Report highlighted weaknesses in the issuance of strata titles, as it exceeded beyond the stipulated time frame of 100 days for an average of 150 plots. 

"Further analysis of the 202 approved schemes showed that a total of 53 schemes (26.2%) were processed within the stipulated time period. Meanwhile, a total of 149 schemes (73.8%) were processed for more than 100 days, involving 141 schemes (94.6%) Kuala Lumpur, seven schemes (4.7%) in Putrajaya, and one scheme (0.7%) in Labuan," the report said. 

There were also weaknesses involving the monitoring and enforcement of the Federal Territories Land and Mines Office and the Commissioner of Building in the aspect of strata ownership applications by developers, as well as regulating strata schemes.

To ensure that the weaknesses are addressed, the AG's Report recommended that the Ministry of Natural Resources and Natural Sustainability and KPKT follow up on the VPST policy, so that its implementation can be coordinated.

Besides that, reviewing procedures and stricter monitoring can help overcome existing weaknesses.

"The sharing of information systems between all parties including the KPKT, the Federal Territories Land and Mines Office, Department of Mapping and Surveying Malaysia, local authorities, developers and management bodies needs to be established to ensure data collection is complete, systematic and integrated.

"In addition, the time period for the application process and issuance of strata ownership rights needs to be improved to ensure that they can be issued immediately," the report added. 

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