Penang Offers 90% Discount For Land Lease Extension, Selangor Records Highest Number Of “Sick” Projects

The state government of Penang is offering a discount of between 50% and 90% for the extension of lease for all categories of land. Meanwhile, National Housing Department data showed that Selangor registered the highest number of “sick” or abandoned housing projects as of 21 October 2022.

1) Penang offers 90% discount for land lease extension

The state government of Penang is offering a discount of between 50% and 90% for the extension of lease for all categories of land. Penang Chief Minister Chow Kon Yeow said those looking to extend the leases of their land will have to pay a premium, which will be based on the land valuation, reported Malay Mail.

“The state government has agreed to give a discount on the premium from as low as 50% to 90% based on the land value without taking into account the value of the structure on the land,” he said during the tabling of state Budget for 2023.

The discount on the premium will apply to those whose leases have expired or are expiring and covers all categories of land – residential, commercial, industrial and agricultural. However, those availing of the discount cannot sell the land within the next 10 years. Those who decide to sell their land within this period will have to pay the full premium for the extension of lease. Chow explained that the moratorium is aimed at preventing land speculation.

2) Selangor records highest number of “sick” projects

Selangor registered the highest number of “sick” or abandoned housing projects in the country, showed National Housing Department data as of 21 October 2022. Malaysia has 387 “sick” projects, of which 73 are in Selangor with 14,774 housing units and involve 7,423 buyers, reported The Star.

The state also has 63 delayed projects with 9,842 housing units and involve 6,496 buyers.

In Peninsular Malaysia, the department identified 3,020 projects that were licensed by the Housing and Local Government Ministry within the same period, but only 2,444 were launched.

“With 387 ‘sick’ projects against 2,444 launched projects, it indicates that the fate of nearly 16% of house buyers is determined by errant developers,” said Datuk Chang Kim Loong, Honorary Secretary-General of National House Buyers Association (HBA).“Hence for every 100 housing projects launched, 16 projects are diagnosed as ‘sick’.”

The Housing and Local Government Ministry described “sick” housing projects as those delayed by over 30% of its scheduled process or those with lapsed sale and purchase agreement (SPA).

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