New ruling on house sales to be issued soon

JAKARTA (JP): State Minister for Housing Affairs Akbar Tandjung said yesterday that the government would soon enact regulations governing the sale of partially-constructed houses, in an effort to protect purchasers from deceitful transactions.

"The ruling is expected to ensure fair transactions in the housing business," he said during a break in a one-day workshop on housing development.

Akbar said that the rules on the pre-sale of houses would be the first of three new regulations now being drafted by his office.

He said the other two instruments concerned, respectively, guidelines on the establishment of a low-cost flats residents' associations, and guidelines regarding supporting business activities in the real estate sector, such as broking and property management consulting.

The minister said that the new regulations on the pre-sale of houses were essential in order to protect buyers from dishonest transactions.

He said that buyers could easily be cheated in cases where the purchase transaction occurred long before the construction of the house had been completed.

"Many documents on the sale of houses are even signed before the start of construction work," he said, adding that in such transactions the buyer was in a weak legal position if, for example, the house was subsequently not built according to the original plans or, indeed, was not constructed at all.

Streamlining

Akbar said the planned regulations which aimed to streamline the operations of supporting services in the real estate sector were important because supporting businesses, such as housing brokerages and property management consultancies, had grown rapidly, in line with the fast development of the country's property sector.

"Such service businesses are licensed by the Ministry of Trade but their activities still lack supervision," he said.

On the planned regulations on the establishment of associations of occupants living in low-cost flats, the minister said that it was needed, not only to help create harmonious neighborhoods, but also to ensure the smooth transfer of flats from developers to occupants.

"Without the establishment of such associations, flats might not be handed over to their occupants," he said. (hen)