Malaysia has a large number of property developers, which is great for meeting the demand for new homes. However, not all developers are trustworthy, and identifying the bad ones is crucial before making a significant financial investment.
Whether you are a first-time homebuyer or a seasoned property investor, ensuring your money goes toward a valuable asset is essential. Here’s how you can identify the right property developer and avoid problematic ones.
Caution and Consideration When Purchasing a Property
Buying property is a huge commitment, and careful research can prevent costly mistakes. Here are some key steps to protect yourself from bad developers:
1. Do Your Research
Reputable developers have a strong track record with completed projects. Look up their previous developments, customer reviews, and overall reputation before committing to a purchase.
2. Check the Blacklist
The Malaysian Ministry of Housing and Local Government maintains a list of blacklisted developers. Avoid developers on this list, as they may have a history of incomplete or fraudulent projects.
3. Go Beyond the Internet
While online research is useful, it’s important to visit the project site physically. Ensure construction is progressing and verify the legitimacy of the development.
4. Request Company Details
Apply to the Companies Commission of Malaysia (SSM) to access developer details. If a developer’s directors have a history of failed businesses, it’s a red flag.
5. Question Unrealistic Offers
If a deal seems too good to be true—such as an unusually low-priced property in a prime location—be cautious. Verify the legitimacy of the offer before proceeding.
6. Consult a Professional
Engage a registered real estate agent or property consultant. Organizations like the Malaysian Institute of Estate Agents (MIEA) can help you find reliable professionals.
Warning Signs of Bad Developers
The Ministry of Housing and Local Government identifies four major categories of bad developer practices:
1) Developers Without Licenses
Property developers in Malaysia must obtain an Advertising Permit and Developer’s Licence (APDL). If a developer cannot provide a valid APDL, they are operating illegally.
Some blacklisted developers for lacking a license include:
Aghniyak Builders Sdn Bhd
Mekar Circle Sdn Bhd
CT Bakti Timor Sdn Bhd
Ample Development Sdn Bhd
Andalas Development Sdn Bhd
2) Developers With Abandoned Projects
Some developers collect deposits but fail to complete the project. This can result from mismanagement, financial instability, or fraud.
Some blacklisted developers for abandoned projects include:
AGA Development Sdn Bhd
Agrocon (M) Sdn Bhd
Akrab Properties Sdn Bhd
Barisan Tenaga Designer Sdn Bhd
Batu Gajah Development Sdn Bhd
3) Developers Who Ignore Tribunal Claims
The Tribunal for Homebuyer Claims handles disputes related to property defects and contract breaches. Some developers refuse to comply with tribunal rulings, leaving buyers helpless.
Some blacklisted developers in this category include:
Astana Land Sdn Bhd (Formerly Kejora Indah Ventures Sdn Bhd)
Ban Soon Aik Development Sdn Bhd
Bumi Diamond Development Sdn Bhd
CY Hitech Development (M) Sdn Bhd
Diamond Crest Sdn Bhd
4) Developers Who Fail to Settle Compound Payments
When developers violate regulations, they may be fined by authorities. Those who fail to pay these fines show a lack of accountability.
Some blacklisted developers in this category include:
Azrat & Hashim Sdn Bhd
Happy Indah Properties Sdn Bhd
Bukit Tandak Development Sdn Bhd
Legendview Housing Development Sdn Bhd
Cybotics Corporation Sdn Bhd
Conclusion
While there are bad developers to watch out for, Malaysia still has many reputable property developers offering excellent homes. By doing your research and following the guidelines above, you can make a safe and informed investment in your dream property.