SINGAPORE:Â More than 100 Singaporean property buyers have found themselves embroiled in a legal conflict with a Malaysian developer after discovering that the homes they purchased in Johor Bahru were under 99-year lease agreements, leaving them feeling more like tenants than actual owners.
According to a report by CNA, around 170 affected buyers have organized a WhatsApp group to coordinate efforts and discuss possible legal measures to reclaim their rights.
The buyers allege that the developer failed to adequately disclose crucial terms and conditions related to the sales agreements at the time of purchase.
One buyer told CNA that he spent S$275,000 on a property intended to serve as a weekend retreat. It was only later that he discovered the property was part of a Private Loan Scheme (PLS), meaning he did not receive full ownership. Instead, the agreement granted him a 99-year lease, with the developer retaining actual ownership of the property.
Under the PLS arrangement, buyers are effectively tenants. They require the developer’s approval to rent out or resell the property.
Additionally, legal experts point out that under this scheme, buyers are unable to obtain strata titles, which are typically necessary for individual property ownership.
This also means they lack voting rights in matters related to the management of the property, such as electing committee members for the building’s management.
Lawyers interviewed by CNA have advised buyers to thoroughly review sales contracts and seek advice from real estate professionals familiar with local property laws before making any purchases in Johor. They also warned that under the PLS, buyers face significant risks.
Creditors could seize the property in the event of a dispute involving the developer, potentially leaving buyers vulnerable. This could also negatively affect the property’s market value.
The developer has reportedly defended the legality of the PLS arrangement and asserted that buyers had missed the statute of limitations to pursue legal action.