Separate board of property managers needed to address current weaknesses

• It is interesting to note that currently, there is a critical lack of PMs (companies as well as individuals) registered by BOVAEP.

Under the Valuers, Appraisers, Estate Agents and Property Managers Act 1981, personnel and/or companies that manage property and/or buildings, be they residential or commercial, are property managers (PMs) who are required to be registered with the Board of Valuers, Appraisers, Estate Agents and Property Managers (BOVAEP). Originally set up in 1981 to govern valuers, appraisers and estate agents, BOVAEP was extended to include PMs in 2018.  

However, it is interesting to note that currently, there is a critical lack of PMs (companies as well as individuals) registered by BOVAEP. As of August 2024, there were only 597 firms licensed by BOVAEP (as listed on its website) to practise property management to serve 22,898 strata schemes (JKPTG (Department of Director General of Lands and Mines), 2022) in Malaysia, while there are 1,589,183 strata units (KPKT (Housing and Local Government Ministry), 2020). For sure, this is grossly insufficient and inefficient—with a ratio of one firm for every 38 strata schemes or 2,662 strata units.

In addition, due to these inequitable logistics whereby registered property management companies are unable to manage the sheer number of properties, they usually appoint building managers (BMs) to run the daily operations of the buildings. 

So, what is the difference between a PM and a BM?  A BM coordinates the maintenance and upkeep of buildings and common properties and these include both commercial and residential buildings. A BM is sometimes referred to as a caretaker, or resident manager and can be appointed by the developer or the individual strata owners’ corporation. Thus, the owners, via their respective joint management bodies (JMB) or management corporations (MC), delegate these functions to their respective appointed BMs for execution. 

On the other hand, a PM is specifically hired to help market the residential or commercial space. They oversee the upkeep and maintenance and are responsible for finding suitable tenants, collecting rents and arranging maintenance. The PM acts as a middle man between the landlord and his tenant. 

However, some quarters, like the Building Management Association of Malaysia (BMAM), have opined that BMs should be separate from PMs because of the nature of their functions. Thus, BMAM has proposed to form a standalone Board of Property Managers, thus separating from BOVAEP. Following this, there has been a flurry of protests in the media over this matter.

(Read: Reader’s Letter: Stricter regulation needed in property management

No need to reinvent the wheel for property management practice in Malaysia

Reader’s Letter: Troubleshooting the law around property management in Malaysia)

As a researcher deeply involved in real estate R&D, my recently published article on “Property manager vs building manager — Are they the same?” was based on my findings through surveys with JMBs and MCs.

With regards to the BOVAEP-registered PMs, unfortunately, I have been told by JMB and MC members that, except on the day of executing a property management agreement with them, they never see the sight of the PMs ever again during the tenure of the appointment.

The PM would deploy a BM/executive to manage the day-to-day affairs of the condo/property and this BM is usually inexperienced and insufficiently trained. In the cases reported to us, the JMB/MC members were the ones training the hapless BM how to do his job as there was virtually zero supervision by the PM. Naturally, due to the sheer logistics, one registered PM can’t be in 38 places all at the same time.

One has to seriously ask, why the governing body, BOVAEP, has not sufficiently managed the licensing of PMs? Maybe this would explain the poor maintenance suffered by parcel owners of many badly-managed strata properties in Malaysia.  

Our strata properties have consequently been devalued, thus eroding our economic wealth. We purchase our homes hoping that it will be a store of value for our old age and for our children to inherit. This does not bode well for Malaysia and for the rakyat as there is an ever-increasing number of strata properties being constructed every year, all of which will continue to be badly managed.

It is far from the truth that BOVAEP is doing a good job in churning out competent registered PMs. If you look at the many badly-managed strata flats, condos and shops in your neighbourhood, and if there is a viable alternative to BOVAEP, I think the JMB/MC members will eagerly support it.

Dr. Foo Chee Hung is the principal researcher from MKH Bhd

The views expressed are the writer’s and do not necessarily reflect EdgeProp’s.

Looking to buy a home? Sign up for EdgeProp START and get exclusive rewards and vouchers for ANY home purchase in Malaysia (primary or subsale)!