Owners of strata title properties must pay attention to the land status of their offices or apartments, especially when the developers only earn Building Rights to establish the properties, an expert says.
Agrarian Law Professor at the University of Indonesia, Arie Hutagalung said consumers should only buy properties built on these kinds of lands as long as they were well-informed about consequenses of the right's status.
"It is important for these consumers to check the land status before making purchases. Most developers show consumers land certificates of their properties after they already buy them," she told The Jakarta Post on Monday.
If it is on the Building Rights, they should read the agreement between the developer and the land's owners because it's possible the agreement contains harmful articles, she said.
She explained that if the properties were built on these lands, the renewal of the tenants' ownership status on their properties would depend on the content of the agreement signed between the developers and the land owners.
Ari said that developers should also explain the land status to their consumers because new owners were entitled to the agreement.
Recently, the North Jakarta District Court ordered a shop owner at shopping center ITC Mangga Dua to pay Rp 1 billion (US$109,000) in compensation to building developer PT Duta Pertiwi after finding him guilty of defamation.
The shop owner wrote protest letters that were published by some national newspapers between September and November 2006. In his letters, he accused the company of cheating buyers of ITC Mangga Dua apartments and shops and that the company did not inform buyers the land belonged to the city administration.
Arie explained that the land in the case was part of the state-owned land managed by the city administration, which as a right holder could use the land with the third party using the Building Rights. This right usually lasts for 30 years.
"It is legal to construct on lands under the Building Rights, but it is best to not involve third parties like these tenants," she said.
Different opinion came from Isono Sadoko, a researcher at the the Akatiga Foundation. Isono said that institutions holding the Building Rights should not transfer the right to build and manage to other institutions such as developers.
"The properties under the Land Use rights belong to the state. The administrations or govermental institutions are just the caretakers," he said.
According to Isono, if the land belonged to the city administration, it could change the land status after getting permission from the city council to release the city's ownership on the land.
"The city administration can share its right to build and manage with the developers and sell strata title properties to individual consumers," he said.
"It will be difficult for consumers to know the land titles, because they should ask officers at the National Land Agency. A corrupt officer will probably say it's allright," he added.
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