Govt mulls new law to help buyers of abandoned commercial projects
Housing and local government minister Nga Kor Ming said the ministry decided to study the feasibility of the Real Property Development Act following extensive engagement with industry professionals, NGOs, and other stakeholders.
PETALING JAYA : Housing and local government minister Nga Kor Ming said his ministry is mulling a law to address the issue of abandoned commercial properties and enhance consumer rights protection.
In a statement, Nga said the Real Property Development Act (RPDA) is being considered in response to modern living trends and the growing number of mixed developments such as retail, commercial, SOFO (small office/flexible office), and SOVO (small office/versatile office) properties.
He said these types of properties are not covered under the current Housing Development (Control and Licensing) Act 1966 (Act 118), which is limited to residential property development projects only.
Nga said that following extensive engagement with industry professionals, NGOs, and other stakeholders, the ministry decided to study the feasibility of RPDA as it would expand the scope of Act 118 to include certain commercial developments – thereby safeguarding the rights of property purchasers.
'Due to the absence of legal protection, buyers affected by abandoned projects in these categories often find themselves with no legal avenue for recourse,' he said.
As of March 2025, the ministry's taskforce on sick, delayed, and abandoned private housing projects, has successfully revived 1,044 projects nationwide, with a total value of RM100.1 billion, benefiting 124,539 homebuyers.
In May last year, Nga was reported to have said that the RPDA will be tabled in the Dewan Rakyat in 2025.
He also noted that the RPDA aims to streamline processes for both buyers and developers by incorporating an Option to Purchase (OTP) mechanism.
Under the OTP framework, buyers would be allowed to terminate the sale and purchase agreement (SPA) if they are dissatisfied with the progress of the development.
This, he said, would enhance consumer rights protection and promote greater accountability in the property industry.
Nga added that the ministry was also considering a Building Managers Act to address the chronic issue of poor property and building management.
Currently, only 594 firms are licensed to provide property management services, serving 26,334 strata schemes – equivalent to 2.91 million strata units – across Malaysia. On average, each firm is responsible for managing 44 strata schemes or 4,898 units.
'This highlights a serious shortfall as there are not enough licensed firms to effectively manage all existing strata schemes,' he said.
'As a result, many property owners and tenants face significant challenges due to declining property values caused by poor management.
'With the proposed Building Managers Act, along with the soon-to-be-tabled Urban Renewal Act, we are committed to addressing the root problems of aged and dilapidated urban buildings, propelling Malaysia toward developed nation status,' said Nga.
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