PETALING JAYA — The Ministry of Housing and Local Government is exploring new legislation aimed at curbing the growing issue of abandoned commercial developments and boosting consumer protection, Minister Nga Kor Ming announced.
Nga said the proposed Real Property Development Act (RPDA) is being studied as a response to evolving urban development trends, especially the rise of mixed-use properties such as SOFO (Small Office/Flexible Office) and SOVO (Small Office/Versatile Office) units, as well as commercial and retail projects.
Currently, these property types fall outside the scope of the Housing Development (Control and Licensing) Act 1966 (Act 118), which only applies to residential projects.
“Buyers of these developments lack legal safeguards when projects are abandoned, leaving them without proper avenues for redress,” Nga said in a statement. He noted that the ministry had engaged stakeholders including industry players and NGOs before deciding to evaluate the feasibility of the RPDA.
According to Nga, the new act would extend the legal framework to cover certain commercial projects, helping protect buyers and enhance accountability within the property sector.
The RPDA, which is expected to be tabled in Parliament this year, will also introduce an Option to Purchase (OTP) system. This mechanism would allow purchasers to exit a sale and purchase agreement (SPA) if the developer fails to meet progress benchmarks — a move Nga said would further empower consumers.
As of March 2025, a special task force under the ministry has successfully revived 1,044 troubled housing projects across the country, with a combined value of RM100.1 billion, benefiting over 124,000 homeowners.
In tandem with the RPDA, the government is also working on a Building Managers Act to tackle long-standing issues in the management of strata properties. Nga pointed out that only 594 licensed property management firms currently serve over 2.9 million strata units nationwide — an average of nearly 5,000 units per firm.
“This shortage has led to poor property upkeep and falling property values in many developments,” he said.
Nga added that the new Building Managers Act, alongside the upcoming Urban Renewal Act, would target the deterioration of older urban buildings and push Malaysia closer toward its goal of becoming a developed nation.