Delight turns to ire for Penang buyers after state doubles price of low-cost flats for reno and ‘sea view’

The E-Garden, a low-cost housing property which is said to be charging more than the original price, is located in Tanjung Bungah. — Picture by Sayuti Zainudin
The E-Garden, a low-cost housing property which is said to be charging more than the original price, is located in Tanjung Bungah. — Picture by Sayuti Zainudin

GEORGE TOWN, July 31 — When administration officer Erman Kamal Mustafa Kamal received an offer letter from the Penang government for a RM72,500 after waiting for 12 years, he was elated.

However, his joy was cut short when he was told that he must pay a “package” price of RM182,000 for the unit to include a carpark and full renovation.

The 34-year-old claimed he was told that his unit, on the 20th floor, was a sea view unit so he had to pay more for it.

“I was not allowed to look at the unit after signing the sales and purchase agreement, but I was told that my package included full renovation,” he said.

When he got the house key and went to view his low-cost flat, he found out the “full renovation” only included tiled flooring.

“There was no lighting, no kitchen cabinets, no proper sinks, nothing, just tiled flooring and their so-called sea view was a lie because I can’t see any sea from the window,” he said.

Erman Kamal Mustafa Kamal speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin
Erman Kamal Mustafa Kamal speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin

Erman, who is also the apartment joint management body chairman, moved into the flat in Mount Erskine in March last year.

He said it was after he moved in and met with other owners there that he realised that each owner was charged different prices for the low-medium cost flat units.

A buyer on the sixth floor, Nur Nazirah Sudin, also paid RM182,000 for a unit under the “package” price that included renovation and carpark.

She said the developer did not give them a choice to refuse the renovation or carpark package.

“We were told that we either take the renovation package, the carpark package or the special offer package of renovation and carpark,” she said.

She said she had asked to purchase only the unit at RM72,500 but was told that it was compulsory for her to take any one of the packages on offer.

G. Letchumy speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin
G. Letchumy speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin

Another buyer, G. Letchumy, 52, said she too had waited 12 years to get the offer for the cheap housing units.

“When they forced us to take the package price of RM130,000, my husband went to complain to the housing department and they told us that if we don’t want it, we can reject and register anew,” she said.

She said her family waited 12 years for a home they could afford and could not risk waiting another 12 years for one to come by again.

The three buyers were among a group who complained to the Penang Consumers Association (CAP) and held a joint press conference today.

CAP acting president Mohideen Abdul Kader said CAP wrote to the developer for a breakdown of the prices for the “packages”.

He claimed the developer replied by stating that the unit cost was RM72,500, car park was RM30,000, corner unit selection was RM8,000, additional price of RM1,000 per floor so for a unit on level 15 it was RM15,000 and legal fees was RM4,500 which brings the total to RM130,000.

“The corner unit or units on the upper floors were not any bigger, all were the same sizes, there were no reasons for the extra charges for corner unit or per floor,” he said.

He said these buyers are from the low income group and have waited to get an offer for a low medium cost unit for many years.

“The state government should do something to stop unscrupulous developers from arm twisting these buyers to pay more than double the actual cost of the unit,” he said.

Consumers Association of Penang (CAP) complaints department head Ravinder Singh speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin
Consumers Association of Penang (CAP) complaints department head Ravinder Singh speaks to reporters during a press conference in George Town July 31, 2019. — Picture by Sayuti Zainudin

He suggested that the Penang government take control over the signing of the sales and purchase agreements for low-cost and low-medium cost housing buyers.

“Instead of sending the buyers to the developers where they were forced to pay more than the actual unit price, the state should let them sign the sales and purchase agreement at the housing department in Komtar at RM72,500 per unit so that the developers cannot force the buyers to pay more for each unit,” he said.

In this particular project in Mount Erskine, he said each unit buyer paid a different price of between RM100,000 and RM189,000 which were stated in the sales and purchase agreement but there was no breakdown of what the additional costs were.

He said not all of the buyers can afford to get loans for RM100,000 and more, otherwise they would not apply for low medium cost housing.

He said each low medium cost unit must only be RM72,500 and unit buyers should never be forced to take up “packages” that included renovation and carpark.

“If they don’t want to take up the package, they were told to reject the offer and apply for others, this is not fair, they have been waiting for years to get this offer,” he said.

He said the buyers of all units in this particular project, a 20-storey low medium cost project called E-Garden with a total 142 units, paid more than RM100,000 per unit which varies according to the buyer’s ability to get loans.

He said it was useless for the state government to keep announcing the construction of more low cost and low medium cost housing units when developers have full control and use it to force buyers to pay more than the ceiling price set by the government.

He called on the state government to look into this and do something about it instead of using the excuse that the buyers had “voluntarily” paid extra for renovation and carpark.

“They were forced to pay more because if they don’t take the package price, they were told they can’t sign the sales and purchase agreement, this was not voluntarily,” he said.

He said this was a long-standing problem that has been going on for almost a decade in which developers of other low cost and low medium cost projects did the same thing to coerce buyers into paying almost double of the unit price.

He said it is time the state government do something about it if they are really concerned about the low-income group not being able to get their own homes.

Related Articles