I recently read with interest, the perspective of the representative of the National House Buyers Association (HBA) who created such furore about the Private Leasing Scheme (PLS) in the housing industry. He unequivocally and “vehemently objects” to the proposed new chapter to the National Land Code which would introduce the PLS in our property legislations.
As elaborated by him, the PLS would allow a freehold land owner (lessor) an opportunity to develop land which they otherwise wouldn’t or couldn’t, without parting with ownership of the land.
From my reading of his article, the stand taken by him is largely based on his assumption that the PLS may be manipulated by land-owning, big organisations that would ‘hoodwink’ house-buyers into merely buying leases. In turn, buyers would end up without ownership, despite years of payment.
To me, this ‘depressive’ picture painted by this HBA representative against the PLS, may in fact ‘hoodwink’ some quarters into believing that the PLS is indeed bad and should vehemently be opposed.
Allow me to help widen the representative’s horizon with regards to how the PLS would positively serve many individual land-owners such as myself.
For years my siblings and I had owned a few acres of freehold land, our ancestral land, which we could not afford to develop. This land had been left vacant, covered by bushes and wild overgrowth amidst some sparse fruit trees.
We were approached by a company that offered to buy the land, to which we refused, mainly because we did not want our ancestral land to be forever lost from our lineage, regardless of whatever amount the company had offered us.
For a long time this company pursued us and last year, they came up with an idea of how our land could be developed by them, without us losing ownership.
It was difficult for us to understand at the beginning, but after a few rounds of explanation and legal consultation, we were informed of an option or alternative to develop this land – the Private Lease Scheme.
Hence PLS presents land owners like us, the opportunity to be able to develop land which we could not otherwise afford. Under this scheme, we would privately lease the land to the company, which would then build homes, leasing them out to potential buyers.
In other words, as they had explained, the buyers would be buying the lease for a period of time, instead of the legal ownership of our land.
To us, this was a highly suitable alternative which we celebrated and looked forward to. It irked me therefore, to read a totally one-sided perspective, painting a picture that housebuyers would be taken advantage of, if the PLS were to be allowed in Malaysia.
There were a few things raised, which even I, as a layman, found difficult to swallow. The especially ‘disturbing’ ones included the claim that it would be understandable for countries like Singapore and Hong Kong to practise leasing schemes especially due to their shortage of land. He went on to allude that since Malaysia has ‘abundant’ land, the PLS had no place in this country.
He continued to criticise the government for ‘peddling’ to the needs of parties in Johor, where the PLS was introduced, among others, to prevent lands from permanently falling into the hands of foreigners.
I personally support the introduction of the PLS under such circumstance, to ensure that our land continue to be owned by Malaysians.
Of course compared to Hong Kong and Singapore, Malaysia has vast lands which have yet to be explored for development. Just because the HBA representative claimed that Malaysia has ‘abundant’ land, it does not mean we should ‘peddle’ our land to foreigners, in the name of profit.
After all, the PLS provides an alternative to land owners like me, provides an option for property developers and provides a choice to homeowners. Certainly, the PLS does not deny nor exclude any other existing conventional development of land.
It was also claimed that the application of the PLS would eventually lead to the rise in house prices. I find this baffling – as far as I am aware, the increase of property prices are usually influenced by speculators and short-term investors, not serious buyers who purchase properties with the intent to live in them.
Another aspect that troubled me was his claim that the PLS had only been introduced in Johor. When I was approached by the company interested in my ancestral land, I was made to understand that the PLS was already practised in certain developments in Penang. In fact, if I’m not mistaken, the practice with regards to Wakaf Land is also akin to the PLS practise.
For individual landowners who cannot afford to develop their land, the PLS is certainly an attractive alternative. Barring any ‘arm-twisting’ by a potential developer, individual owners of freehold land, should have the right to decide to lease their lands to the developer.
So long as both parties possess the desire, the choice and the capacity to contract and the relevant laws and regulations are adhered to, the HBA has no business telling anyone what they should or should not be allowed to do with their land.
Granted, the HBA seemingly has the interest of buyers in mind. However, so long as buyers are aware of the status of the property that they are interested in, they too are presented with a legitimate choice, in the absence of fraud or deceit.
They possess the capacity and capability to acquire properties and enter into contracts with their eyes wide open, knowing what they would sign up for.
If a buyer is uncomfortable with properties under the PLS, they have a choice to buy properties of conventional developments. Why then would the HBA interfere with rights and choices of these private parties, to legitimately enter into contracts in relation to the PLS?
I am sure there are many individual owners of ancestral land who plainly could not afford to do anything with their land, leaving them untouched for years. The PLS opens the doors of opportunity for us to develop our land, without having to part with ownership.
We certainly look forward to the expansion of the PLS throughout the country as an alternative approach to land development. – Nov 5, 2020
Syed Tariq
Kuala Lumpur
