KUALA LUMPUR (May 8): The Housing and Local Government Ministry (KPKT) is studying an option to purchase (OTP) mechanism to be introduced under the proposed Real Property Development Bill, to improve safeguards against sick, delayed and abandoned housing projects.
In a statement on Friday, KPKT Minister Nga Kor Ming said the proposed framework would allow buyers and developers to reconsider or exit a transaction before entering into a formal sales and purchase agreement.
This would give both parties more room to assess commitment at an earlier stage, said Nga.
He said the proposal forms part of broader housing sector reforms under the Madani government’s ongoing initiatives to update regulatory structures and improve long-term industry sustainability.
Talks of the proposed Real Property Development Act first emerged in May 2024. The act will cover mixed developments, including retail and commercial properties. Such properties are not covered under the current Housing Development (Control and Licensing) Act 1966, which is limited to residential developments.
According to the statement, the minister said that the OTP mechanism could help developers gauge actual buyer interest and demand more effectively before progressing too far into construction.
“Consequently, it helps avoid scenarios where developers face financial bottlenecks if sales are not optimistic halfway through construction,” he said, adding that the mechanism could reduce the risk of unsold units stemming from weaker buyer interest.
Separately, the ministry’s taskforce on troubled housing developments has revived over 1,500 delayed or abandoned projects since late 2022, which represents a gross development value of over RM140 billion.
He added that the government will continue working with private sector stakeholders to improve the delivery of sustainable, quality and affordable housing.