JOHOR BARU: Foreign buyers should closely examine the property terms in Johor before they sign a Sale and Purchase Agreement (SPA) as this would help prevent misunderstandings or legal disputes.
Datuk Mohd Jafni Md Shukor, the State Housing and Local Government Committee Chairman, said this on Thursday (Dec 26) when asked a question about the legal issues Singaporeans have encountered in buying property in Johor,
He said that the state has different kinds of property schemes.
The New Straits Times quotes Mr Jafni as saying, “Some are leasehold with durations of 30, 60, or 99 years, while others are freehold. For example, industrial areas in Johor are typically not permanent and must be returned to the government after the lease period expires.”
Buyers from Singapore, China, Hong Kong, Australia, and other countries need to review the land tenure terms of their purchases before signing the SPA. They should know whether the transaction is for leasehold or freehold, he said.
Mr Jafni explained that land tenures are determined during the development phase, adding that it is the buyers’ responsibility to make sure they understand the terms outlined in the SPA before they commit to the deal.
Some Singaporean homebuyers have snapped up condominiums in Johor that were sold under a Private Lease Scheme (PLS). These are not outright purchases granting full ownership but 99-year leaseholds. However, the transactions have resulted in legal disputes.
“Clearly, the issue is between the developer and the buyers, thus the importance of buyers clearly reviewing the terms in their SPA before signing,” added Mr Jafni.
However, some have criticized the scheme as restrictive and lacking in transparency, and buyers have said they were unaware of the long-term tenancy terms, thinking that they would own the properties.
Mr Jafni said there were 170 Singaporeans who said that the SPA was unclear and are challenging their terms of purchase. However, he expressed confidence that matters would be amicably settled to the benefit of both parties. He was also optimistic that the court’s decision would be made impartially.
Mr Jafni said that the state government is not involved in the disputes. He added that Singaporeans and other foreign property buyers should not worry about purchasing property since all terms and conditions are clearly stated in the SPA, and buyers’ rights are protected.
Under the PLS, 56,247 service apartment units have been offered so far. Nearly four-fifths (44,437) were sold between July and September this year, with each costing at least RM500,000 (S$152,000). /TISG
Read also: Over 100 Singaporean buyers in legal dispute over Johor Bahru properties