Long list of high-rise problems
11/02/2007 NST By P. Selvarani; Malina Jeya Palan

The trials and tribulations of owning a condominium could make the ‘luxury’ facilities and amenities that go with it a farce. Several disgruntled owners list out their complaints to P. SELVARANI and MALINA JEYA PALAN.

FOR Sam, it was the dream home for his young family. The 20-storey condominium in an upmarket part of Selangor was almost perfect. It was close to a shopping mall, with other amenities a stone’s throw away.

As Sam had to travel outstation a lot for work, the 24-hour security was an added bonus to keep his family of four safe.

"It seemed perfect," said Sam, who bought the property six years ago. "There is a swimming pool and a gym and there are tennis courts.

"But such comforts mean nothing when the lifts break down frequently, the paths are dirty, rubbish is uncollected and there are thefts and break-ins."

Worse still, Sam is technically not the owner because the condominium is without a strata title.

Like Sam, Tengku Nazaruddin Zainuddin, owner of a unit at the Istara condominium in Petaling Jaya, is at his wit’s end.

Tengku Nazaruddin, the pro-tem chairman of the Condominium, Apartment and High-rise Committee (CAHC) of the All PJ Pro-Action Committee, said: "It has been eight years and we still have not received any statement of accounts from the management."

He said owners had no idea how the sinking fund has been used.

"By the time we take over the management of our condominium, the sinking fund may be zero."

The residents had recently received their strata titles after an eight-year wait and were eager to manage and maintain the condominium themselves, as provided for by the law.

"People who own high-rise properties and those wishing to invest in one should be aware of some of the potential problems.

"If all condominium management companies adhered to the law governing stratified properties, condominiums would be a good place to live in."

Tengku Nazaruddin said there was a lack of transparency in many dealings.

For instance, many owners are not aware that withholding accounts from residents is a violation of the Housing Development (Control and Licensing) Act 1966.

Section 19 of the Act states that the developer shall provide the purchaser with a copy of the annual audited accounts for expenses incurred for the provision of services, while Section 20 (sub-clauses 3 and 4) provides for the sinking fund accounts to be made available to the purchasers.

One reason some companies refuse to provide details is because they are collecting the management fees illegally, as the owners of the Ridzuan Condominium in Bandar Sri Subang discovered.

Apart from problems concerning cleanliness, maintenance and security, they discovered the company managing the condominium had broken the law by collecting management fees of 20 per cent since 2000.

"Under the Valuers, Appraisers and Estate Agents Act 1981, only companies or individuals registered with the Board of Valuers, Appraisers and Estate Agents are allowed to collect management fees," said Ridzuan Condominium Residents Association pro-tem chairman Soo Ka Loong.

"We have proof the company managing our condominium is not registered with the board."

Soo said residents also discovered that a portion of the sinking fund had been used to renovate and buy office equipment.

And the residents, he claimed, had not received the audited accounts of the sinking fund for the past five years. A police report has been lodged.

The owners have also been waiting for their titles since 2000.

"When we checked with the Land Office about the strata title delay, we were told the developer still owes RM145,000.

"Now we have problems selling our units."

The security leaves much to be desired as strangers enjoy easy access to the premises.

"Many students occupy units here and the guards do not screen those entering the buildings. Anyone can walk in and out."

In the case of Tan Lee Lian, she is still waiting for the strata title to her La Chateau condominium, 15 years after buying the property.

"I have had one excuse after another over the delay," said Tan. "We don’t even have a sinking fund."

James Yau, 41 of Taman Connaught Apartments in Cheras faces the same problem.

Residents have not seen statements of accounts for the sinking fund for the last 15 years.

Law clear on fee collection

THE law is clear. Only a company registered with the Board of Valuers, Appraisers and Real Estate Agents is allowed to charge professional management fees.

"When a condominium or apartment is issued with a strata title, it should be run by a management corporation comprising owners of the property," said board president Abdullah Thalith Mohd Thani.

"However, should the owners outsource the management of the property to a third party, then they have to appoint a registered valuer."

For properties without strata titles, the onus is on the developer to manage the building.

"Even then, developers can only make a claim for actual costs incurred, such as administrative costs for repairing lifts.

"They cannot collect management fees because they are not professional valuers."

No third party may be hired unless the company is registered with the board.

Abdullah said although the board was aware that many developers were appointing their own people to manage the condos and apartments, there was little the board could do as it had no jurisdiction over non-members.

"They only thing the owners or residents can do is to lodge a police report if someone is collecting management fees illegally."

Abdullah advised owners to engage a professional valuer to manage their properties as they would be covered by professional indemnity insurance.