Singapore home buyers face losses and bank interest payments as Johor projects are abandoned

SINGAPORE: Singapore home buyers who have invested in Johor properties have been left paying bank interest and facing significant losses, as projects remain unfinished past their scheduled completion dates.

According to Channel News Asia (CNA), 65-year-old Singaporean swimming coach Chu Siew Hoe refinanced his Sengkang executive condominium and borrowed S$300,000 to fund a RM1 million dual-key unit at Sovereign Bay in Johor Bahru 10 years ago for a “peaceful retirement” overlooking the Straits of Johor.

However, the waterfront project, developed by Singapore’s UE E&C and China’s Sichuan Sanjia Real Estate Group, which was slated for completion in 2019, remains unfinished and is now listed as “abandoned” by Malaysia’s Ministry of Housing and Local Government.

Meanwhile, Mr Chu is left with no choice but to struggle to pay around S$2,000 a month in mortgage instalments with no certainty of ever receiving his keys.

Another Singaporean, 45-year-old Kenneth Tan, who purchased a high-floor unit at The Peak in Tebrau for RM1.7 million in 2013, has lost six figures in Singapore dollars after paying the booking fee and hundreds of thousands over the years and is now prepared to give up the unit altogether.

He stopped payments in 2022 when Malaysian developer Gabungan AQRS was unresponsive. The Peak was slated for completion in 2016.

CNA noted that when they visited the site, one of The Peak’s two towers remained unfinished, while the other stood hollow, with concrete walls exposed and air-conditioning units left on the lower floors. The sales gallery in Taman Molek still bore the project’s signboard but was itself under construction.

Johor Bahru has long attracted Singaporeans with its lower prices and proximity, an appeal boosted by projects like the RTS Link and the planned Johor-Singapore Special Economic Zone.

However, the Malaysian state has one of the highest numbers of abandoned developments, behind only Selangor and Terengganu. Government data showed it has 12 condominium projects classified as “sick”, meaning development construction is more than 30 per cent behind schedule or past the agreed delivery date, and the purchase agreement has expired.

Singaporeans online have advised others not to buy property in Malaysia, suggesting it is safer to rent if they plan to retire in JB. Meanwhile, others remarked that it is not the first time developments have been left unfinished in the state, warning buyers to do their research. /TISG

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