May 27 2016, 12:11 PM, updated 10y ago
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1.1 Recently, two condos (KM1E by Berjaya and Concerto by BCB Berhad) of mine VP simultaneously.
1.2 To keep it simple, I will call those two condos "mine" because there r personal arrangements behind them.
1.3 It was seriously not funny because I had to do defect rectification for two condos.
1.4 I can roughly say, I have paid enough tuition fee to give free advice to everyone.
1.5 To add, I am also whatapp administrator for two owner groups both km1e and Concerto. From the two groups, I can tell that most of the suffering, frustration and pain are more or less the same. I can say to some extent, I feel all your pain cause I am going through the exact same phase.
1.2 To keep it simple, I will call those two condos "mine" because there r personal arrangements behind them.
1.3 It was seriously not funny because I had to do defect rectification for two condos.
1.4 I can roughly say, I have paid enough tuition fee to give free advice to everyone.
1.5 To add, I am also whatapp administrator for two owner groups both km1e and Concerto. From the two groups, I can tell that most of the suffering, frustration and pain are more or less the same. I can say to some extent, I feel all your pain cause I am going through the exact same phase.
2. The Goal
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2.1 Know what questions to ask
2.2Protect yourself from getting screwed
2.2Protect yourself from getting screwed
3. Assumptions & Disclaimers
3.1 Assumption
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3.1.1 I would assume that you have cross-checked and fact checked with whatever source out there and you have finally brain washed yourself to buy the property that you wanted.
3.1.2 Notwithstanding people normally say “it’s always about the location” but people never tell you the last part “buyer beware or more affectionately known as Caveat Emptor!”.
3.1.3 I am assuming readers have read and understood your sales and purchase agreement. For those who want to go further, you can also read up on the Strata Management Act and also Strata Title Act. Not any interesting read guaranteed.
3.1.2 Notwithstanding people normally say “it’s always about the location” but people never tell you the last part “buyer beware or more affectionately known as Caveat Emptor!”.
3.1.3 I am assuming readers have read and understood your sales and purchase agreement. For those who want to go further, you can also read up on the Strata Management Act and also Strata Title Act. Not any interesting read guaranteed.
3.2 Disclaimer
3.2.1 The opinion, views, answer and/ or example produced are based on my experience, common sense and encounter of the problems and issues. Some of the problems and issues may be real or hypothetical, in any case is used for reference and discussion purposes only to enable readers to better understand the issue and/ or the problem concerned.
3.2.2 Feel free to feedback and challenge every word I have written in this thread, this will improve the content significantly and allow me to provide source to reinforce my conclusion.
3.1 Know what questions to Ask
3.1.1 SOP questions
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(i) I think more or less everyone know what the basic questions to ask, nevertheless I will elaborate further for the benefit of first time purchasers.
(ii) My intention is actually to touch on more “unique and possibly disturbing developments”.
a- facing
Seriously, it’s not a temporarily problem. Pick wisely. The facing of the sun could turn your condo into a living hell (as in the heat).
b- layout
This is a distinguishing factor between a conventional (old skool) and the new kid on the block developer.
There are pros and cons to each developer. The old skool folks generally go for proven methods, whereas the new kid will try some funky stuff.
Case in point:
It really depends on what you want at the end of the day.
c- Bank loan
I won’t go into detail as to how bank assess your credit worthiness or whether you can get 90:10 financing, those you need to figure out yourself.
If you are buying either mid or tail end of a launch, be ready for a world of hurt. Banks have a certain quota because they want to mitigate concentration risk in the event the Developer fail to deliver the project.
d- promotion
Like in lowyat plaza or in an electrical shop, you should be thick face enough to ask.
Example: DIBS schemes, developer rebate, free air conditioning etc…
e- Special arrangement
Don’t have enough cash for down payment? Don’t worry just ask the developer sales representative whether they can do temporary bridging.
f- Referral arrangement.
This is where joining a whatapp owner group becomes profitable. Enquire within the relevant property groups. You can start small with 1-2 person and snowball later on.
Case in point:
g- freehold or leasehold land/ residential or commercial title.
This is something you should know because you will incur a lot more cost in the future.
Example:-
Assuming you stay on a piece of land for the entire duration of the lease and the lease expires... What then?
The type of land i.e. commercial or residential will have a big impact on your wallet. For instance, commercial titled land, electricity and water will be charged at "Commercial Rates". Unlike residential property, the maintenance fee for commercial title is subject to 6% GST.
(ii) My intention is actually to touch on more “unique and possibly disturbing developments”.
a- facing
Seriously, it’s not a temporarily problem. Pick wisely. The facing of the sun could turn your condo into a living hell (as in the heat).
b- layout
This is a distinguishing factor between a conventional (old skool) and the new kid on the block developer.
There are pros and cons to each developer. The old skool folks generally go for proven methods, whereas the new kid will try some funky stuff.
Case in point:
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Exsim (one of my favourite up and coming developers) – managed to cram 5 rooms into 1700 sqf
BCB (my current developer) – 3 bedrooms, 5 toilets in 1950 sqf
BCB (my current developer) – 3 bedrooms, 5 toilets in 1950 sqf
It really depends on what you want at the end of the day.
c- Bank loan
I won’t go into detail as to how bank assess your credit worthiness or whether you can get 90:10 financing, those you need to figure out yourself.
If you are buying either mid or tail end of a launch, be ready for a world of hurt. Banks have a certain quota because they want to mitigate concentration risk in the event the Developer fail to deliver the project.
d- promotion
Like in lowyat plaza or in an electrical shop, you should be thick face enough to ask.
Example: DIBS schemes, developer rebate, free air conditioning etc…
e- Special arrangement
Don’t have enough cash for down payment? Don’t worry just ask the developer sales representative whether they can do temporary bridging.
f- Referral arrangement.
This is where joining a whatapp owner group becomes profitable. Enquire within the relevant property groups. You can start small with 1-2 person and snowball later on.
Case in point:
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BCB project, I was chatting in forum about wanting to buy the property. Someone PMED me and we hooked up and subsequently confirmed with BCB sales rep. Both of us walked away with $$.
g- freehold or leasehold land/ residential or commercial title.
This is something you should know because you will incur a lot more cost in the future.
Example:-
Assuming you stay on a piece of land for the entire duration of the lease and the lease expires... What then?
The type of land i.e. commercial or residential will have a big impact on your wallet. For instance, commercial titled land, electricity and water will be charged at "Commercial Rates". Unlike residential property, the maintenance fee for commercial title is subject to 6% GST.
3.1.2 unique questions
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There’s no such thing “WHAT YOU SEE IS WHAT YOU GET IN SHOWROOM” and developer will turn around and say “FOR ILLUSTRATION ONLY”.
a- Anything provided by developer (example fixture, furnishing, toiletries, flooring or electrical etc…)
Ask for brand name, model and serial number. After that confirm in writing with developer. If developer not willing to confirm, things are VERY likely to change.
aurora97 @Today, 12:19 PM
QUOTE
Yes and I should make it clear in my posting that it is not something provided in the HDA.
I take a broader view that the showroom (though not specifically specified in HDA or SPA) is a form of advertisement and therefore should comply with Regulation 8(1A) in HDR 1989, more specifically item (e) i.e. “any particulars to which a housing developer cannot genuinely lay proper claim”.
In the showroom, they can promise everything in the sun and it wouldn’t be fair for them to suddenly turn around and say, “hey look, it’s not stated or covered in the SPA… too bad/tough.” Besides, we are giving this stuff out for free, be grateful.
Essentially, the developer can just verbally say, oh hey we provide washer, dryer, water filter, x5 air conditioning units, 65” TV etc… in the showroom just to bait you to buy their units. Then when you get your key, you find a washer, no water filter, 2x air conditioning unit and a 24” inch Tv.
I do agree with you that there are commercial realities to be taken into account but as a purchaser pouring our life savings into a condo unit that’s just too much to risk.
I take a broader view that the showroom (though not specifically specified in HDA or SPA) is a form of advertisement and therefore should comply with Regulation 8(1A) in HDR 1989, more specifically item (e) i.e. “any particulars to which a housing developer cannot genuinely lay proper claim”.
In the showroom, they can promise everything in the sun and it wouldn’t be fair for them to suddenly turn around and say, “hey look, it’s not stated or covered in the SPA… too bad/tough.” Besides, we are giving this stuff out for free, be grateful.
Essentially, the developer can just verbally say, oh hey we provide washer, dryer, water filter, x5 air conditioning units, 65” TV etc… in the showroom just to bait you to buy their units. Then when you get your key, you find a washer, no water filter, 2x air conditioning unit and a 24” inch Tv.
I do agree with you that there are commercial realities to be taken into account but as a purchaser pouring our life savings into a condo unit that’s just too much to risk.
Case in point:-
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No names. Showroom had presented an “Electrolux” fridge, during VP a “Sharp” brand fridge was given and it was a very old model.
No names. Toiletries were supposed to be an establish German brand (as I was told), later became “ToTo” an Ok brand.
No names. Toiletries were supposed to be an establish German brand (as I was told), later became “ToTo” an Ok brand.
There are two types of developer to this scenario. The conventional type normally will deliver VP within 36 months from the date of SPA. Whereas, there are some will deliver VP within 48 months from the date of SPA.
In my own personal view, it would be preferable to select the following:-
(i) if fixture and fittings provided, go for 48 months (case in point Exsim, they use the additional time to fit out the development); or
(ii) if bare unit, go for 36 months (case in point UOB).
Those who promise to deliver fixture and fittings within 36 months, likely than not is a rush job and electrical goods purchased are general out dated or old model.
b- maintenance and sinking fund
This use to be and SOP question but many people has been caught by surprise especially the amendment to SMA 2015.
Case in point:-
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No name. In showroom, we were told the maintenance charge was about 0.35-0.38c psf. When the unit was VPed, we got the shock of our lives because it was close to 0.44c.
As such, don’t believe every garbage that the sales rep feed you with. They survive on commission and are hell bent on reaching into your pocket.
As such, don’t believe every garbage that the sales rep feed you with. They survive on commission and are hell bent on reaching into your pocket.
What should you do?
Step1:- (Deleted, see quote below:-)
SAHM @ May 30 2016, 12:11 AM
QUOTE
Schedule 5 – Form of Service Charge Statement
A lot of people have a misunderstanding of this Fifth Schedule.
It is not required to write down the service charge per square metre, to be exact, per share unit in the Fifth Schedule of the SPA. The SPA says when developer request for service charge “shall be supported by a charge statement as issued in the form annexed in Fifth Schedule .” ie, the amount need not to be decided or written in the SPA at the point of purchase, but when they request for payment.
A lot of people have a misunderstanding of this Fifth Schedule.
It is not required to write down the service charge per square metre, to be exact, per share unit in the Fifth Schedule of the SPA. The SPA says when developer request for service charge “shall be supported by a charge statement as issued in the form annexed in Fifth Schedule .” ie, the amount need not to be decided or written in the SPA at the point of purchase, but when they request for payment.
QUOTE
Schedule 6
To be exact, there is no Schedule 6 in the standard Schedule H. What developers do is that, they are amending the format in such a way that all the variable information to be stated in one page for convenience sake. Normally this page consists of purchaser’s and property’s particulars. These are the very important information . But, won't be surprised if your SPA doesn’t have 6th Schedule, it is not wrong.
To be exact, there is no Schedule 6 in the standard Schedule H. What developers do is that, they are amending the format in such a way that all the variable information to be stated in one page for convenience sake. Normally this page consists of purchaser’s and property’s particulars. These are the very important information . But, won't be surprised if your SPA doesn’t have 6th Schedule, it is not wrong.
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They will normally tell you Schedule H is standard but what they don’t tell you is that Schedule 1 to 6 can be changed, this is where you will likely to be get screwed over.
Step 2:-
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(i) determine your parcel size.
(ii) determine your accessory parcel size. (will discuss later what are accessory parcel)
(ii) determine your accessory parcel size. (will discuss later what are accessory parcel)
Step 3:-
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Apply formula:-
Area Parcel is: 1,000 sf or 93 sm
Accessory (Private lift) is : 100 sf or 9.3 sm
Accessory (Car Park) is: 100 sf or 9.3 sm
The following is the calculation:-
[Area Parcel + (Accessory Private Lift + Car Park/ 2)] x amount per allotted share unit = RM X payable per month
Area Parcel is: 1,000 sf or 93 sm
Accessory (Private lift) is : 100 sf or 9.3 sm
Accessory (Car Park) is: 100 sf or 9.3 sm
The following is the calculation:-
[Area Parcel + (Accessory Private Lift + Car Park/ 2)] x amount per allotted share unit = RM X payable per month
c- Accessory Parcel
Under the old regime, until the Strata Title is issue… All this accessory parcel will not be reflected in your maintenance charges and therefore absorb by the management. This is technically unfair to those owners who own a large chunk of accessory parcels (example 3 car parks, 5 air conditioning ledge, 2 private lift lobbies as opposed to 1 car park, 1 air conditioning ledge).
So the SMA made it fair.
However, there are some instances this good intent is abused. Take private lift lobby for instance. The Developer will normally advertise their unit is say 1000 sqf, more privacy with private lift lobby etc… What the developer doesn’t tell you is that the private lift lobby is actually an accessory parcel to the main parcel. Meaning that it is actually 900 sqf you r getting with additional 100 sqf attached.
For private lift lobby, please be mindful that IT CANNOT BE FULLY SEALED, there is a BOMBA requirement that there is a 5% opening for ventilation. IF YOUR DEVELOPER TELLS YOU THAT YOU ARE GETTING A FULLY SEALED PRIVATE LIFT LOBBY, I SUGGEST YOU NOT TO BUY IT.
So what’s the big deal about accessory parcels? Maintenance charges are halved and the management retain some control over your accessory parcel.
Further elaboration on why is maintenance charges halved for accessory parcel:-
KoChin @ May 27 2016, 02:57 PM
QUOTE
my understanding is the formulae is a guide and still subject to formulae applied by the developer and subject to authorities' approval. ie. ledge and cp may not be halved, etc.
Answer: -
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you are right SMA states that section 5 Schedule 1 Table 1. The Factor is 0.5.
d- So you think you have an SPA you are safe?
WRONG.
Each and every services stipulated in Second Schedule and building description stated under Fourth Schedule must be cross-checked and confirmed in writing with developer.
Case in point:-
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No name: under the Second Schedule, it was stated there is a “Tai Chi Lawn” provided. However, during VP this was not sighted. Also, they are “not sure” where to allocated the car park slot. So the moral is simple, if your developer say a certain service is provided, request that they specifically name the area and location the place in which the services will be provided.
No name: under the Fourth Schedule, it was stated that a “Gas Piping” will be built. After some time, we started to enquire with developer. Apparently, developer had gotten an exemption from local municipal hence is not required to install an LPG system. Jokes of our lives. Next thing they probably have an exemption for toilets.
No name: under the Fourth Schedule, it was stated that a “Gas Piping” will be built. After some time, we started to enquire with developer. Apparently, developer had gotten an exemption from local municipal hence is not required to install an LPG system. Jokes of our lives. Next thing they probably have an exemption for toilets.
Further elaboration...
KoChin @ May 27 2016, 02:57 PM
QUOTE
this is real bad. if that's the case, you guys should have demand for rebates as savings from providing this.
Answer:
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will let everyone know the outcome, we fighting developer now. Relying on Clause 13 and 34 of SPA. Can’t wait for the developer to pull the next rabbit out of the hat trick.
e- thinking of buying furniture in advance? LOL, seriously think again.
An owner took the initiative to enquire about the dimension for the service lift. The developer obliged and furnished him the schematics. I bet 99% of buyers won't do this.
Though his initiative is appreciated, it turned out the furniture couldn't fit the car park lobby door (normal fire door), service lift door and the utility door leading to his house!
Case in point:-
No name. Both property developments are now encountering difficulties in moving in furniture. A lot of people are really scratching their heads now.
4. Other tips
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a- Non-stop marketing and cold calls.
Example: people asking you whether you want to sell your house.
This is a recent phenomena but I am pretty sure the developer has a hand in it. Being in 2 whatapp owners group allow me to see recurring themes. It is also the developer's SOP to blame it on TNB and Syabas for leaking personal data.
Fact of the matter is, the marketing and cold calls that came happened even before the TNB and Syabas agreements were signed.
I suggest you subscribe to a pre-paid card number cause it is going to be very irritating especially after VP.
b- SPA with execution page only
Personally, I don't think executing an execution page only SPA is wise. Unless there are other VERY good reasons you have in mind, such practice should be an immediate red flag.
You should at the very least be given Schedule 1 to 6 of the SPA for review.
c- no more BS, misleading and fake advertisements.
The contents allowed in “any advertisement made by any licensed housing developer” are further restricted with the insertion of Regulation 8(1A) in HDR 1989, which prohibits the following:
Source from: Halim Hong & Quek
d- u want the unit pay booking fee first boss!
Previously only developers were prohibited to collect any payment such as ‘booking fees’ or ‘earnest deposit’ before signing of a sale and purchase agreement. To further protect purchasers[10] the amended Regulation 11(2), HDR 1989 expressly expands this prohibition on stakeholders:
“No person including parties acting as stakeholders shall collect any payment whatever name called except as prescribed by the contract of sale”
Source from: Halim Hong & Quek
e- HONEY my CONDO has Shrunk!!!!!!
KoChin @ May 27 2016, 03:38 PM
Example: people asking you whether you want to sell your house.
This is a recent phenomena but I am pretty sure the developer has a hand in it. Being in 2 whatapp owners group allow me to see recurring themes. It is also the developer's SOP to blame it on TNB and Syabas for leaking personal data.
Fact of the matter is, the marketing and cold calls that came happened even before the TNB and Syabas agreements were signed.
I suggest you subscribe to a pre-paid card number cause it is going to be very irritating especially after VP.
b- SPA with execution page only
Personally, I don't think executing an execution page only SPA is wise. Unless there are other VERY good reasons you have in mind, such practice should be an immediate red flag.
You should at the very least be given Schedule 1 to 6 of the SPA for review.
c- no more BS, misleading and fake advertisements.
The contents allowed in “any advertisement made by any licensed housing developer” are further restricted with the insertion of Regulation 8(1A) in HDR 1989, which prohibits the following:
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(a) offer of free legal fees;
(b) projected monetary gains and rental income;
© claim of panoramic view;
(d) travelling time from housing projects to popular destinations;
(e) any particulars to which a housing developer cannot genuinely lay proper claim”
(b) projected monetary gains and rental income;
© claim of panoramic view;
(d) travelling time from housing projects to popular destinations;
(e) any particulars to which a housing developer cannot genuinely lay proper claim”
Source from: Halim Hong & Quek
d- u want the unit pay booking fee first boss!
Previously only developers were prohibited to collect any payment such as ‘booking fees’ or ‘earnest deposit’ before signing of a sale and purchase agreement. To further protect purchasers[10] the amended Regulation 11(2), HDR 1989 expressly expands this prohibition on stakeholders:
“No person including parties acting as stakeholders shall collect any payment whatever name called except as prescribed by the contract of sale”
Source from: Halim Hong & Quek
e- HONEY my CONDO has Shrunk!!!!!!
KoChin @ May 27 2016, 03:38 PM
QUOTE
difference in area is 2%. anything smaller than that, you may claim.
refer clause 12 (3).
ceiling height or common corridor width, etc, should be benchmark against the building plans.
nothing in showroom is binding.
refer clause 12 (3).
ceiling height or common corridor width, etc, should be benchmark against the building plans.
nothing in showroom is binding.
This post has been edited by aurora97: May 30 2016, 01:40 PM
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