On quality – The Sky’s the limit

SINCERITY is the most important quality for a developer, said SkyWorld executive director and COO Lee Chee Seng. Lee has been in construction and development business for the past 20 years.

“You cannot hide or run away,” said Lee, referring to new houses sold in the market, that come with defects. If the workmanship is not up to standard, word will get around as customers won’t be happy and ultimately the developer’s reputation will be tarnished.

“We (developers) are also a (home) buyer; our purchasers are ‘first line’ buyers,” said Lee. And as most people are purchasers of a place to make home of, Lee brings up a fact about home buyers and their lack of knowledge about quality products and what they should look out for. Over the past years, Lee observed that there were complaints in the market where quality was concerned. Rather than seeing it as “a problem” he took it as an opportunity and made good of his realisation.

BIG ON QUALITY

Five years on and the SkyWorld Quality Centre was launched.

“We try to educate the purchaser, let them know their rights, rights to complain on defects,” said Lee. This was the idea behind the establishment of a “centre” where home purchasers will be taught how to identify quality workmanship and spot construction defects. The other reason was due to the confidence in SkyWorld’s portfolio of quality “products”.

At the first-of-its-kind SkyWorld Quality Centre, prospective home owners are given a “Quality Tour”. The objective is mainly to educate and cultivate an eye for construction workmanship and identifying defects of newly constructed houses.

Apart from home buyers, the RM3.8 million centre is open to the public, consultants and contractors, and anyone who wants to learn about quality standards in housing construction. According to Lee, other property developers also participate in the tour.

“With the naked eye, one normally will not be able to pick up if a type of finishing is of compliant or non-compliant quality standards. But by using certain tools, home buyers will be able to spot the flaws,” said Lee.

For example, tiles on the floor may look good when a home owner has moved in but it may be hollow (underneath). In some cases, doors may not be fitted into the door frames properly.

“The gap between the door and the frame should be less than 5mm and it must be consistent. A lot of people don’t even notice that the gap is inconsistent (all around the frame),” Lee shared.

He also felt that home owners should be aware of their rights; the reason the centre teaches how to identify defects.

BRAND PROMISE

One who is all for delivering good quality products, Lee says, “If a SkyWorld piece of property is found with defects at delivery, we will rectify or change it,” Lee said.

Bent on educating home buyers and the public on their rights, he stresses his point – “They need to know they have the right to reject it, if the material and finishes are compliant or non-compliant to quality standards; you have the right to ask for it to be rectified or changed.”

According to Lee, home buyers have 24 months to seek any “rectification” from a developer on their purchased property.

“The Defects Liability Period (DLP) is stated in the Sales and Purchase Agreement,” informs Lee.

Lee’s reason behind highlighting property defects and educating the public on such matters is mainly founded on a desire to raise the standards of the construction industry.

“Once property developers know that purchasers are aware of quality standards and that they have the right to high expectation on delivery of these standards, the quality of construction will definitely rise.

“We want to raise the standards of the Malaysian property market. We want you to learn to pay attention to details that matter as we feel that this is our responsibility – to give back to home purchasers as a responsible developer,” shared Lee.

RAISING THE BAR

Although SkyWorld is merely a few years old, being established in 2008, with their first project launched in 2014 – Lee ensures that all its projects are submitted for certification by QLASSIC or CONQUAS – Singapore’s building quality standards.

QLASSIC is short for “Quality Assessment System in Construction”. It is a construction workmanship quality assessment system drawn up by the Malaysia Construction Industry Standards under CIDB Malaysia, which constitutes the highest standards in assessing build works of quality.

According to Lee, SkyWorld’s affordable homes project, SkyAwani series under the “RUMAHWIP” housing scheme, will also be submitted for QLASSIC certification; they expect to score high.

“In Malaysia, about 7,600 projects and developments are built each year but only 4.1% of homes are QLASSIC certified.

“Last year, we achieved a 76% score for Ascenda Residence. The market norm stands at 75%; 70% is the average, and we’re proud to have set the bar higher than the market norm achieving 76%,” said Lee like a proud father speaking of his child.

“When you consider a SkyWorld home, you can be sure about our quality commitment,” Lee said.

A brand founded on quality; the SkyWorld Quality Centre is reported to have achieved an 85% QLASSIC quality score.

The centre is open to the public and anyone can make an appointment to learn and receive insights on construction finishing, quality standards and flaws. Each tour takes about one to one-and-a-half hours.

While quality centre hosts will be at hand to share their knowledge, Lee has plans to organise a life learning experience for SkyWorld home buyers, inviting quality experts to share their insights, tips and tricks.

Those interested on learning can join the tour by registering at www.skyworld.my or write in to corporate@skyworld.my.

Re-examining the market

BASED on the property market outlook report by CH Williams Talhar & Wong Sdn Bhd (CBRE WTW) for Malaysia, there was a 5% decline in volume (the number of property transactions) but a 7% increase in value recorded in the third quarter of 2017, compared to the third quarter in 2016.

The residential sector also dominated the overall market attaining a 62.1% share in volume and 48.7% in value. Slower absorption rates were reported, causing an increase in unsold residential units, covering both completed and under construction units. The estimated figures stood at 146,497 units in 2Q 2017, compared to the historical average of 72,000 units per year between 2004 and 2016.

From 1H in 2016 to 1H in 2017, housing starts went up by 16% totalling 67,662 units – hence, the government recommended a freeze on residential developments of homes priced over a million each.

According to the National Property Information Centre (Napic), the office space vacancy rate stood at 23.6% in Q1 2017. Considering the incoming supply of another 38 million sq ft, vacancy rate is expected to escalate to 32% by 2021, meaning a vacant one in every three offices.

The scene on the commercial side is none the less worrying what more with the 140 new shopping complexes targetted for completion by 2021.

Existing supply of commercial space will increase – in the Klang Valley by 70%, Penang by 40%, and Iskandar Malaysia by 150%, amid vacancy rates of 13.4%, 30.6% and 24.2% recorded at 1Q 2017. These numbers gave rise to the recommended freeze by the government, for office and retail developments.

Helping to level out the “pessimistic outlook” are two sectors that appear to be less affected by the impending glut – hotel/tourism and industrial. Still, with GE14 just around the bend, the market is indeterminate. According to CBRE WTW’s report – “What seems evident is that we can anticipate further market turbulence in 2018”.

Central Klang Valley High-Rise

In brief, the market is focused on established and matured areas near to KL city centre which cover these areas – Golden Triangle and its fringe areas and Metropolitan KL encompassing Ampang Hilir and U-Thant, Bangsar, Damansara Heights, Kenny Hills and Mont Kiara/Hartamas areas. According to the report, these areas “look to be doing well”.

Still, the industry backdrop illustrates a soft market. However, condominium sales in KL is still considered steady, evidenced in slightly improved sales rates, relatively unchanged occupancy rates in recent years, and a smooth flow of new launches. The occupancy rates and performance of existing condominiums are reported to likely improve.

Klang Valley Landed Residential

An eventful 2018 is expected in this sector as transaction activity rose during 3Q 2017 by 39.9% y-o-y. The overall House Price Index (HPI) for Selangor also increased by 1.5 points, similarly in KL. Over a million units of landed properties were recorded across the states of Selangor, KL and Putrajaya, with more expected to enter the market over the next two to three years.

According to the report, new developments of townships concentrated in the southern and northern parts of the Klang Valley are deemed to help retain market interest and demand for landed residential property. With the anticipated MRT Line 2 and 3, DASH 2, West Coast Expressway infrastructure developments running along, connectivity between city centres and surrounding areas is expected to generate a more positive impact to the landed residential sector in the Klang Valley.

What was exciting was the issue of affordable homes where a mismatch in affordability was considered to be more acute in urban cities like Selangor, Kuala Lumpur, Penang and Johor.

The Household Income and Basic Amenities Survey Report 2016 for Selangor by the national statistics department reported an estimated 13.34% or 200,000 households in the B40 bracket (earning a monthly household income of less than RM3,860). 43.4% of those in this group in Selangor were reported to be renting houses which suggest a demand for some 94,000 residential properties eventually. To capture this demand, pricing within the buyers’ affordability will have to be studied.

Affordable housing developments were noted in the report, situated to the north and south of Klang Valley – Putra Heights, Danau Perintis Shah Salam 2 and Cyberjaya among others. Under the rakyat-centric programmes, more houses were completed in 3Q 2017 and more are expected to enter the market with Budget 2018 allocating RM2.2 million for such houses.

The words of CBRE WTW Foo Gee Jen as per the report: “As far as the real estate industry is concerned, robust economic expansion in early 2017 somehow has not spilt over to the property market as the year closed. Nonetheless, optimists are suggesting that the property market shall see the light at the end of the tunnel in 2H 2018. That would be desirable but buckle up, as uncertainties will still linger on in 2018”.

With the GE14 up our alley and the fine-tuning of the housing ministry’s Housing Data Bank System Portal to be accessible to all this year, not to mention the changes (hopefully beneficial to the people) in the National Housing Policy – DRN 2.0 for 2018-2022 – let’s hope the sluggish market will receive a new breath of life with the development of these schemes.

Follow our column next week sharing more information on the industry outlook, including views of other professionals in the field.

Rehda aims to showcase 70 developers at Mapex 2018

PLANNING to purchase a new house or invest in a property? The largest and most awaited property event, Malaysia Property Expo (Mapex) 2018 is back again, this year at the Mid Valley Exhibition Centre (MVEC) from April 27 to 29.

Mapex is regarded as the largest one-stop centre event that brings convenience to those seeking to purchase or invest in property. The expo offers a wide range of innovative property development projects, from “under construction” to “completed properties” across a broad range of property types. Admission is free and open to the public.

The organiser, Real Estate and Housing Developer’s Association Malaysia (Rehda), expects to gather at least 70 developers under one roof this year, offering some of the best property deals.

Organising chairman of Mapex 2018 Datuk Ng Seing Liong (pix, third left) said that the Federal Territories Minister Datuk Seri Tengku Adnan Mansor will be officiating the opening ceremony on April 27.

During the press conference, it was announced that over 40 developers have confirmed participation. The target is to rope in 70 to 80 including Ecoworld Development Group Berhad, IJM Land Berhad, Glomac Berhad and others.

“Our theme this year is #ahomeforbettertomorrow,” said Ng at the press conference at the Rehda office. Of the belief that home is the most important asset, Ng also said, “We would like to emphasise that property is a good investment and it will appreciate in value.

“Securing a home early will ensure a better future as property investment is the safest investment that appreciates over time,” he added. On its part, Ng said Rehda will continue to organise Mapex in its role to provide a good platform for potential buyers in search of their dream homes.

Rehda’s plans for the year is to organise 20 expositions, two already held in January and February, outside the Klang Valley. The weekend of March 16 to 18 saw a “mini Mapex” held at Setia City Mall in Bandar Setia Alam, Shah Alam offering 20 property developer booths.

Visitors to this year’s Mapex 2018 can expect an exciting time listening to insightful talks on property by industry experts, receive deals and discounts from developers on selected developments. A RM2,000 cash giveaway also awaits 15 lucky individuals who make their property purchases at the expo.

Additionally, there will be a blood donation drive and popcorn and cotton candy “on the house”.

Furry friends in mind

Taking fluffy and whiskered pets into consideration when decorating

FUR babies have taken a higher priority over their human counterparts, at least for many young married couples or those in long-term relationships from the looks of it.

Pets that used to serve as guards of dwelling places are now pampered with a life of luxury, complete with plumped-up beds to sleep in, air-conditioned quarters of their own and food of the highest quality.

It’s no surprise then that many homeowners today may be looking for a way to make their home more pet-inclined to suit the “lifestyle and liking” of their furry housemates.

On the other hand, pet expert-cum-author Julie Szabo says, “If a house doesn’t work with dogs, it won’t work with children or guests either.” Hence, decor ideas for happy households that encompass the furry kind and less hirsute.

FLOORING

The consensus on flooring when one has pets is to use ceramic tiles. Marble and other natural stone are porous materials, which can ruin and permanently stain due to all types of excreted pet wastes.

Ceramic tiling offers many benefits that tip the scales in its favour – it is easy to clean, is highly resistant to stains, toenail-proof, gives fur babies a cool place to nap, and lastly, it makes a room look sleek and elegant.

Decor Aid, in a blog post for Huffington Post, informed, “Tile is a great flooring option for pet owners, but you probably don’t want it in every single room. In that case, try sealed hardwood or synthetic woods, which are durable and less expensive than hardwood.”

HGTV Design Star judge and interior designer Vern Yip recommends to get wood flooring with scratch-resistant finishing. Yip also suggests getting ceramic tiles that look like stone flooring for a varied look, “because it looks like stone, but unlike stone, it doesn’t absorb urine or such, like if your dog has an ‘accident’.”

It also goes without saying to avoid carpeting at all costs, as carpets and fabrics absorb odour, traps pet hair and soaks up inevitable pet-related stains. If you really need wall-to-wall carpeting for any reason though, Decor Aid recommends “sealing the carpeting to avoid stains”.

RUGS

The idea of rugs would generally seem like a firm “no” for a home with pets. However, dogs would probably have a whale of a time chewing and tearing into it, while cats will be more than happy to sink their claws and scratch into it. So rugs are really a “yes”, the issue would be choosing the right kind of fabric to suit your furry baby (or babies).

Szabo recommends sisal or seagrass rugs, as it provides “an elegant, neutral backdrop that will go with any decor”. Moreover, these are sturdy and easier to clean. Choose low pile weaving to ease the cleaning process she advises.

If the idea of cleaning your home everyday sounds tiring, then choose rugs with patterns and colours similar to your pet’s fur to camouflage shed fur. Avoid rugs made of viscose, rayon and artificial silk.

They may look gorgeous but are too delicate to maintain with a pet in the house. These kinds of rugs are better treated as art pieces to be hung on walls, high up and away from sharp claws and nails.

FABRICS

There is really no way to avoid getting your pets and their fur all over your couch; you can only make the up-keeping less frustrating and cumbersome for the human occupants.

When choosing a sofa or fabric, consider the following: Can it be cleaned easily? Will it look ugly if my pets’ claws got into it? How long can it last?

Many interior decorators recommend getting leather-clad furniture. Decor Aid explains that fur can be easily wiped off leather, adding that owners should choose leather with more of a patina, which helps mask or blend in the scratch marks.

Besides, leather also tends to look classier with some wear and tear.

Then again, there may be a sad irony in using materials made from animal skin or pelt in a pet-loving home, so DIY Network writer Leanne Potts advises using “pleather” instead as it is “cruelty-free, relatively inexpensive and has a timeless appeal”.

Other options include re-upholstering your sofa with fabric meant for both indoor and outdoor use as it is made to withstand the weather, climate and high traffic, without feeling hard or rough. Depending on your pets’ fur colour, use identical hues and prints in your upholstery to avoid shed fur from sticking out like a sore thumb.

If all else fails, just get a large, attractive designed blanket and throw it over your couch to keep fur off the furniture. Every few days, take the blanket outside and give it a good shake to get the fur out.

PAINTS

“Pets present you with the opportunity to really work with colour,” says Szabo. However, white walls are a terrible choice for a pet-loving (or kid-filled) home, as the colour is more susceptible to discolouring.

It is also advisable to ensure that the finishing used can be wiped down with a cloth if any drool or pee gets onto it. Semi-gloss finishing is the best, but the sheen tends to highlight imperfections if used on a wall. Consider getting a satin or eggshell finishing instead; it’s just as easy to clean, but exudes elegance.

However, there are certain companies that have developed “wipeable” flat paints.

DECORATIVE ITEMS

As for decorative items, it is best to place them in locations that will be difficult for your pets to reach. Chicago interior designer Nan Ruvel suggests putting your “fragile displayables in a glass-panelled China cabinet. That way you can see them, but your pet can’t break them”, she explains.

Avoid displaying items on low tabletops, especially if you have an active pet; one case of the zoomies and everything will be flying off the table, most likely end up in pieces! Spend your decoration funds on framed prints, photos and paintings instead.

They will be high up on the wall, away from claws and excretion, and relatively safer from ruination.

For the joy of your pets, if you have some pet toys lying about, it is recommended to keep them in lidded baskets or ottomans when not in use.

They provide your home with a chic look at the same time gives the interiors a neat-enough appearance for visiting guests to be welcomed into.

Lastly, if you’re a plant lover, do a quick check that the plants you plan on bringing home are not toxic for pets.

The American Society for the Prevention of Cruelty to Animals (aspca.org) runs a database where pet owners can check if their plants are toxic or non-toxic to their dogs, cats and other common pets such as birds and horses even.

Aloe vera, for example, is a common plant found in many Malaysian homes, which is reportedly toxic to both cats and dogs.

If your pet were to ingest aloe vera, it could cause vomiting, lethargy and/or diarrhoea.

This 2018, being the Year of the Dog, let’s consider our pets, especially our “four-legged extended family member/s”, and make home a warm and pleasant place for all to live in.

Strata effort: Rise of the ‘Register of Property Managers’

AFTER 13 years of discussion and deliberation on how to resolve/minimise the issues faced by strata-property owners and tenants, relevant parties finally came to a resolution on Jan 11.

The Valuers, Appraisers and Estate Agents Act 1981 (Act 242) is now recognised as the Valuers, Appraisers, Estate Agents and Property Managers Act 1982, following an amendment which was passed on Oct 17 last year and gazetted in January.

The shift from this amendment and what it constitutes is expected to be of benefit to many, especially strata-titled property owners and tenants.

However, as in any change of regulations, the outcome, whether “plus or minus”, will only surface down the line. What is important is that those involved in administering, regulating and monitoring the enactment of the “rules of the system” will need to be super efficient and have their eye on the ball to ensure the plan pans out as expected, or even better.

Advance and improve

It was reported that the “projected/anticipated end result” was what initiated the amendment to the Act, which paved the way for the establishment of the “Register of Property Managers” (RPM).

Basically, the RPM comprises a band of Property Managers (PM) under a “Register”. Who or what is this “Register”? It consists of trained, professional and sanctioned personnel, who are well versed in property matters, who will be supervised by a RPM board/committee, regulated under the Valuers, Appraisers, Estate Agents and Property Managers Board, which falls under the authority of the Ministry of Urban Wellbeing, Housing and Local Government. The RPM will be governed by Act 242.

All this change is expected to improve the local strata and property landscape. Its core purposes:

1) to help resolve/lessen issues under the “strata-property banner”; and

2) to aid strata-property owners, tenants and JMBs/MCs, who now have the option of turning to RPMs to address their quandaries and issues.

“The PM will bring multi-tiered benefits to the profession and Malaysian homeowners. These well-informed, trained and capable individuals will be able to offer their services to JMBs/MCs, possibly reducing the number of complaints relating mismanagement and industry malpractice.

“Property Management that is well governed will lead to the well-being of the nation and improve investor confidence in the country,” said Minister of Wellbeing, Housing and Local Government Tan Sri Noh Omar (seventh, right), at the official launch of the Register.

Develop and change

Homeowners including strata-property owners will have an option to settle strata-related disputes and issues.

They can either raise their concerns with their respective JMBs and MCs, or together, agree to employ the expertise of a PM to address their grievances.

The registered/sanctioned PMs, being trained and sanctioned, will be able to attend to property issues in a proper, lawful and possibly faster time frame.

While some may see the establishment of the “Register” as just another “layer”, level of bureaucracy and administration, (looking at past experiences and the number of long-outstanding strata-titled issues) – ministry officials, the Bovaep and the regulating RPM committee/board are forward-looking and convinced that the Register will bring advantageous outcomes and generate positive repercussions in the industry.

Noh, who officially launched the Register, spoke of the painstaking process and long wait for this meticulously established and timely solution – a result from the unprecedented joint effort between his ministry and the Ministry of Finance.

In support and present at the launch was the Second Minister of Finance Datuk Seri Johari Abdul Ghani (eighth, right), Bovaep president Nordin Daharom (sixth, right) and industry individuals.

It was stated at the launch that all practitioners of property management will be regulated by the Board.

While strata-owners (and such) will benefit as the “sanctioned” PMs entrusted with the management of properties will be regulated by professionals on the Board, this (and more) will safeguard strata-owners (and such) from the illegal wheelings and dealings of unscrupulous individuals who claim able to manage property.

“The responsibilities of the PM are indeed very challenging as they will need to manage all kinds of situations, having to be wise with relevant parties they deal with, apart from having solid technical expertise to address and solve problems pertaining property,” shared Nordin.

Options and effects

Practising property managers have until end of 2018 to register and receive recognition as sanctioned and approved PMs. Beyond the “grace period”, the process to gain formal recognition will be more stringent.

Chartered surveyor, property valuer, consultant, PM, real estate agent and BOVAEP member Kamaruzaman Jamil advised property managers and interested parties with property management experience to check the application criteria now.

“Once the ‘window period’ is over, a degree in property management and formal training is required,” he said.

Deputy director-general of operations in valuation and property services Dr Zailani Mohd Isa was on the same page. She felt that this was a good opportunity not to be missed.

“Property managers who fail to register with the RPM and continue practising from next year on, will receive a warning, besides suspension and be slapped with a huge fine of up to RM25,000,” she said.

In Malaysia, it is reported that there are approximately 5,000 property managers. Of these, only some 1,200 have registered with the RPM.

Practising property managers are advised to register with the Board by filling out and submitting Form C via http://lppeh.gov.my/WP2016/forms Complaints/grievances on registered PMs can be filed in writing to the Board at info@lppeh.gov.my

With property management now a regulated professional practice governed by the Valuers, Appraisers, Estate Agents and Property Managers Act 1981, and the professional and experienced line-up of individuals representing the RPM committee/board, strata-property owners and tenants (and such) will hopefully be able to spend less time attending numerous meetings to discuss long outstanding strata and property problems and issues.

Follow our property section next week featuring our monthly interior design article, followed by our series on the property market outlook in Malaysia for 2018.

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Property Manager (pm) application Criteria

1. Past Property Management Experience

(a) Experience at managerial level

(b) Areas of experience in at least one area in:

i) Financial Management and

ii) Building & Facilities Maintenance Management.

2. Declaration of:

(a) No police record.

(b) No case of mismanagement.

(c) No breach of fiduciary duties.

(d) Not blacklisted by COB.

(e) Not found guilty by Strata Tribunal.

(f) No disciplinary action by Bovaep.

3. Area of Experience:

PM experience in at least one sub-area in Financial Management and at least one sub-area in Building & Facilities Maintenance Management.

Financial Management:

(a) Keeping of proper accounts.

(b) Debt recovery measures (credit control measures).

(c) Insurance renewal covering all possible risks.

(d) Insurance claim procedures & application of claims.

Building & Facilities Maintenance Management:

(a) Proper maintenance & repairs of building facilities & M&E plants.

(b) Proper procurement process & full tender process.

(c) Management & control of renovation contractors & workmen.

(d) Management of tenancies and facilities.

(e) Convening & facilitating general meetings for JMB and MC.

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RPM Responsibilities

1. Comply with the Act, rules, regulations and the Property Management Standards (PMS).

2. Practise with honesty and integrity.

3. Deliver services professionally and observe the professional ethics and Code of Conduct.

4. Maintain high standards of his/her profession to protect the public against fraud, misrepresentation and unethical practices in property management.

Penalties

1. Cancellation of registration.

2. Suspension of registration.

3. Admonishment.

4. Admonishment and fine not exceeding RM10,000.

5. Fine not exceeding RM25,000.

6. Published conviction in newspaper/electronic media.

STRATA SERIES – Serious on strata

STRATA-type property is and has been all the rage. It is also expected to be “the living model” if not already.

Whether in cosmopolitan cities or suburban fringes, and as space becomes “in want” and prices hike, we feature our final article on strata-related property highlighting pertinent questions frequently asked to which Chris Tan (CT) gives input on.

Q: What should one look out for in the S&P before deciding on buying a particular strata-titled residential property?

CT: Buying a strata title property is not just buying a property but buying into a community living regulated by law. As a buyer, you are not only responsible for your very own unit but also the common property within the development too.

There is an ongoing obligation to pay the monthly service charges and sinking fund until the day you sell the same to another owner.

Besides the S&P Agreement, you are normally expected to sign the Deed of Mutual Covenants too, that regulates the relationship of the many owners within the same development with house rules vis-a-vis the prescribed by-laws under the Strata Management Act. In addition to the compliance with these rules, you are also expected to participate in the management of the common property at the Annual General Meeting as well as the Extraordinary General Meeting.

In the completion of the S&P Agreement, do ensure that the seller has no more outstanding charges and sinking funds owing the management and that the deposits paid are to be adjusted accordingly.

Q: Can you please explain further on ‘share units’ of strata-titled property? How does this affect a residential strata-titled property owner or what is the relation between the owner and the share units?

CT: Share unit has always been there in strata living as it will be stated in the strata title upon its issuance. It is now capturing the limelight, given that it is now the basis to be contributed into the maintenance charges and not the usual rate psf of the size of your main parcel.

There are different ‘weightages’ for the main parcel, the accessory parcel and the type of usage to make up the various elements of the share unit.

Suffice to say that two units of apartments of the exact same size might have different share unit allocation, if one has more accessory parcels than the other, or one is of commercial usage while the other is residential.

Q: What are some current and common issues faced by owners of strata-titled residential property and how would these be best settled?

CT: Issue 1: Contribution to service charges and sinking funds from the owners have always been done on the total size (in sf.) of the main parcel. Under the new regime since June 2015, it should now be based on per share unit instead.

Share unit is a concept that takes into account the size and the usage (of different allocated weight) of both the main parcel as well as the accessory parcel. It’s stated clearly in the strata title when it is issued. It is also the basis of voting by poll if so requested in any General Meeting. Share unit is therefore now the basis of both contribution and control as opposed to just control in the past.

In theory, it should be a fair method for all. The issues are:

(i) Some strata owners find themselves paying more than before while some strata owners now pay less; and

(ii) The Share unit allocation under the previous legal regime was a result of consultation and discretion and not as transparently guided under the new law. It is a difficult process and to adjust again, particularly when the strata titles have been issued, will be tedious.

Issue No. 2: In Phased Development there is now a requirement to file the Schedule of Parcels (SOP) stating clearly the total share units to be offered under the entire development before one can proceed to sell. It therefore includes the later phases of a development that will only be developed in the future.

The issue is that this SOP can only be adjusted if we can get 100% of the owners to agree or it is a direction from the authority.

There will be no flexibility accorded to the developer who might want to change the SOP for the feasibility or sustainability of the development, taking into account the new circumstances of the future, in the best interest of the entire development.

Another related issue would be on the contribution of the allocated share units by the developer for yet to be developed phase in the maintenance of the common property already built and delivered.

Q: Any other ‘surprises’ or areas of concern that many strata-titled residential property owners are unaware of until after purchase of such residents?

CT: Don’t be surprised if the property does not come with an allotted car park, although it is a norm to expect a car park to come with the unit. It is not always the case.

Q: Like many busy owners of a strata-titled property who do not have the time to sit in at resident’s meetings with the management body – many have simply ‘gone with the flow’ of things as ‘questions/disputes’ require time for discussion.

What would you recommend for busy individuals who have ‘no time’ to attend such meetings but can only look at the annual/bi-annual strata/building management statements/financial reports? What should one keep an eye out for in these financial statements?

Why is it important to attend these meetings; what would owners be losing out on by not attending and being an ‘active owner’?

CT: It is a regulated community living and participation is expected of every owner.

Although many have chosen to be passive, you need to participate or run the risk of letting major decisions lay in the hands of the active few.

You should keep an eye to ensure that the charges collected are well spent, that collection should always be monitored and the performance of the appointed property manager.

Also, understand your rights and obligations as a strata owner is important, and ensure that you and your neighbors are equally aware of the same too.

Q: As a tenant, and not the owner of the ‘parcel’ – are they bound to all the By-laws?

CT: The by-laws, additional by-laws and amendment of such additional by-laws made by the Management Body shall not only bind the owners but also the tenants, chargess, lessees and occupiers.

Q: Any other important issues that you would like to highlight to readers of theSun?

CT: Moving forward, strata living will be the preferred way of community living. Take a keen interest to learn and understand this living model in order to get the most out of it.

There are many more frequently asked questions, especially on management bodies, by-laws and leakage and defects. Answers to these can be found in Chris Tan’s Owner’s Manual & Guidebook.

Follow our property column next Friday for more insights on the market in the local scene.

Strata management boost

THE Valuers, Appraisers and Estate Agents Act 1981 – Act 242, has been amended, gazetted on Jan 2, 2018, to become the Valuers, Appraisers and Estate Agents and Property Managers Act, 1981.

This led to the Urban Wellbeing, Housing and Local Government Ministry launching the ‘Register of Property Managers’. With this Register, strata-property owners can rely on ‘professional, well-informed and capable’ registered property managers to address their grievances and find solutions to strata-property issues in a proper, lawful and hopefully faster time frame.

The photograph features Members of the Property Management Committee who will oversee the ‘sanctioned/registered property managers’, together with (from eighth, left) Finance Minister 2 Datuk Seri Johari Abdul Ghani, Minister of Urban Wellbeing, Housing and Local Government Tan Sri Noh Omar and the Board of Valuers, Appraisers and Estate Agents Malaysia president Nordin Daharom at the official launch of the Register. Follow our property article on Jan 26 for more exciting details.

Strata intelligence: Important information pertaining strata-type property

CONTINUING from our series of features on strata-titled property, previously on Dec 29, this week we feature a pictorial and point-form article highlighting important information on management bodies, the strata management tribunal and the commissioner of buildings, as well as their roles and responsibilities.

Management bodies

The main purpose of setting up a “management body” (MB) is first and foremost to “maintain and manage the building or land intended for subdivision into parcels, common property and such other related matters”.

The different MBs established during various phases/periods of “completion” of the strata property can be further divided into two categories:

1) When the vacant possession of parcels are delivered to the strata owners BEFORE the issuance of the strata titles.

2) When the vacant possession of parcels are delivered to the strata owners AFTER the issuance of the strata titles.

Features of each management body Powers and duties of the MB

The vital role of a MB is to control, maintain and manage the Common Property, for the benefit, comfort and enjoyment of the Strata Owners, including its occupants. These no doubt gives the MB authority, but that which comes with responsibilities.

Below are SOME of the powers and duties of the MB:

1) Determine and impose charges commonly known as “service charges or maintenance charges”;

2) Determine and impose sinking fund contributions, which serve as a kind of reserved fund, usually 10% the rate of service/maintenance charges;

3) Setting up and upkeeping the Maintenance and Sinking Fund accounts; maintaining proper records and annual auditing, statements, filing, and providing financial statements and info to the Strata Owners, etc;

4) To insure building under a Damage Policy via a licensed insurer;

5) To set up a proper administration office within the Common Property;

6) To comply with Notices or Orders issued by authorities pertaining the Common Property, the Strata Owners’ parcels, etc.;

7) To enforce by-laws and additional by-laws – fines and such, where monies collected are deposited into the maintenance account; and

8) In statutory presumption cases where leakage and damage to “inter-floor” and/or “party wall” originates from the upper floor parcel (unless the upper floor Strata Owner can prove otherwise) – the MB has to carry out an inspection within seven days from receiving the “notice/complaint”, determine the cause, determine the party responsible to rectify the defect, to issue a certificate of inspection “Form 28”, to carry out and expenses from responsible party in the event the responsible party fails to rectify the “problem” within seven days from the date on the Form 28.

[Refer to Chris Tan’s Owner’s Manual & Guidebook for the complete list of MB’s powers and duties.]

Strata Management Tribunal

A tribunal is established under the Strata Management Act (SMA). Called the Strata Management Tribunal (SMT) – it is established mainly to settle disputes in relation to strata management issues, in a more expedient manner and via minimal costs.

Who can be members of this Tribunal? They must be appointed by the Minister of Urban Wellbeing, Housing and Local Government. The position of the chairman and his deputy can only be occupied by members of the Judicial and Legal Services. A minimum of 20 additional regular members must comprise those in the Judicial and Legal Service, including lawyers with more than seven years of experience in practice.

The SMT only takes up issues related to strata management. Claims and disputes sought cannot amount more than RM250,000. There is also no jurisdiction to hear claims pertaining land title, or estate or interest in land, or any franchise, which is in question.
Some of the more common disputes the SMT resolves include those regarding outstanding service charges, unsatisfactory management, defect rectification by the developer, disputes among strata owners on leakage issues, rejected renovation plans, etc.

Claims must be filed with the “Tribunal Perumahan dan Pengurusan Strata”, regardless of the location of the parcel concerned. Offices are located in Putrajaya, Penang, Johor Baru and Kuala Terengganu.

Commissioner of Buildings

Otherwise known as COB, the “position” can only be taken up by an authority employed by a district city council office e.g. MPSJ, MBPJ, DBKL, etc.

Below are SOME of the powers and duties of the COB:

1) To enforce the provisions of SMA including all rules and regulations promulgated there under;

2) To act as “trustee” for the Common Property Defect Account;

3) To appoint a managing agent if in any case all Strata Owners refuse to become members of Committee or the MB fails to carry out its duties to the satisfaction of the COB;

4) To assist/direct the MB – in convening meetings, in exercising its duties and powers in accordance to the SMA, in imposing and reviewing the Charges, and reviewing decisions; and

5) To issue warrant of attachment, if required, with the aid of the MB or police personnel, and supervise the auction for recovery of sums vide warrant of attachment.

[All information and charts are retrieved from Owner’s Manual & Guidebook by Chris Tan.]

Follow our final part of the series next week on frequently asked questions on strata-type property and advice from Chris Tan himself on certain issues.

STRATA SERIES: Singling out strata

HOW many of us living on strata-titled property can say that we are well aware, informed and updated on strata-type property issues? In fact, there are many people who buy and have bought such property without knowing much about it.

Many are of the notion that all high-rise residential property – flats, condominiums
and apartments – are considered strata-titled property, which to an extent is quite correct, then again …

Hence, the property team at theSun decided to get strata info straight via a series of articles highlighting views of industry professionals on this property type.

A finger on strata

Brief definitions and explanations to help the layman (and woman) receive strata clarity: The word “strata”, according to the dictionary, originates from the word “stratum”. It is defined as “one of the parts or layers into which something is separated”. In property, a strata title is defined as:

* a form of ownership devised for multi-level apartment blocks and horizontal subdivisions with shared areas. The “strata” part of the term refers to apartments being on different levels, or “strata” – Wikipedia.

* one of the title structure of ownership, and it basically gives you the privilege to control over a property or a piece of land, as well as enable you to transfer the property to others; generally applies to high-rise buildings such as residents of flats, apartments, condominiums and commercial buildings jointly developed within a development that shares common facilities – WMA Property.

* one of the title structures of ownership and control over property. It is usually applied to subdivided buildings or complexes such as high-rise buildings, town houses, duplexes, flats, apartments, condominiums and commercial buildings – National House Buyers Association.

According to Strata Management Act 2013 (Act 757), the “development area” of a strata-titled property relates to:

1. A building or land intended for subdivision into parcels, means any land on which the building or land intended for subdivision into parcels is developed or is in the course of development or intended to be developed.

2. A subdivided building or land, means any alienated land held as one lot under final title (whether Registry or Land Office title) on which the subdivided building or land is developed.

Strata in essence

When buying property in Malaysia, one should be aware of the various titles or deeds the intended property is attached to. These include Leasehold, Freehold, Bumiputra Reserve, Master Title and of course Strata Title (mixed-use, commercial-use and residential-use), the last which we will highlight, being the popular property type in urbanised areas across the globe, and in Malaysia, strata living is fast becoming a way of life.

According to property expert Chris Tan, who knows strata through and through, property owners especially intended purchasers of strata-titled property should rethink the concept of “my home is my kingdom”, in its place consider the more practical “love your neighbour”. He says that “strata living is intended for collective living, thus will be best enjoyed collectively”. He is also of the view that property purchasers looking to buy strata-titled property should be open to community living, sharing of common property, paying for service charges and sinking funds, as well as maintenance and upgrading of common property.

He correlates strata owners with “shareholders of a public-listed company where the management body takes mandate, similar to the board of directors, and the market value of one’s property is impacted directly by how well it is managed by the management body”. Now how many of us are aware of this?

Current and crucial

No doubt, there is a lot to discover where strata-titled property is concerned, not to mention a Pandora’s Box of strata disputes awaiting resolution.

However, we will only touch the tip of the iceberg this week and highlight several issues ExaStrata Solutions Sdn Bhd CEO and chief real estate consultant Adzman Shah Mohd Ariffin feels the public should be aware of in purchasing properties under strata development of the following nature:

1. Developments held under liquidation.

The developers have wound up and liquidators are managing the development. In several cases, the statutory payments such as quit rent and assessment rates have not been paid. As a result, it is difficult for purchasers to secure loan as the receipts are not available to be submitted for loan application and thereafter submission of Memorandum of transfer (MOT). Some liquidators also charge up to 2-3% administrative fee for issuing consent for owners to sell.

2. Developments which are of mixed components e.g. retail/office/service apartments all on one title.

The maintenance charge rate payable must be the same for all components under Act 757. However, the different components may have different needs and also facilities and may even require more expenditure which results in more to be borne by the maintenance fund. This will cause a lot of disagreement between the owners in the different components.

3. Developments which have very little chance of issuance of strata title in the near future.

There are cases of developments which have already been occupied for more than five years but the developers have yet to submit the application for strata titles. In these cases, the developers may have already become dormant. Some may have also run out funds and are not willing to pursue the application for strata titles due to the high expenses involved. Hence, very little chance of obtaining the titles any time soon.

4. Developments which have less than 70% take up.

When less than 70% of the units are not purchased, it is likely that there will be poor collection of maintenance charges. Unless the developer is paying maintenance charges for the unsold units, it is unlikely that the development will be well maintained and managed.

5. Developments which were developed by developers not registered with the
Ministry of Urban Wellbeing, Housing and Local Government.

It is best to check whether the developer is registered with the ministry in order to ensure that they are governed by the Housing Development Control and Licensing Act 1966.

“In the above cases, the marketability as well as value of the properties may be affected to a certain extent in the long term. It is therefore wise to avoid these types of developments,” Adzman states.