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added statistics of ‘ overhang ’. The booking fees collected from potential buyers shall be placed in a ‘ Fidelity Fund ’ under the Housing Development Project Account to facilitate the refund exercise in the event that the option is declined . This is to also to prevent unscrupulous developers or their authorized agents from absconding with the booking fee . The housing developer shall be held responsible whether the booking fee is being collected by their appointed authorized agents or lawyers , as stakeholders .
The amount of booking fee should not be excessive and in all cases shall not be more than RM5,000 or 1 % of the purchase price , whichever is the lower . After all , booking fee merely serves as a security for the developer to grant a right of option to the purchasers and also to allow the developer to gauge the marketability and saleability of their project . It is also intended to convince the bridging financiers that the project has reached a reasonable margin of sales and give credence to the project undertaken by the housing developer . The quantum of bookings reflects the level of demand of the housing project and they are assured that the project will not become an
Prescribed Option to Purchase Form – Booking Fee
In order to ensure uniformity , a standard booking form shall be prescribed in the relevant law such as the HDR . The rights , entitlement and obligation of respective parties shall be drafted in plain language and set out in the standard booking form with the dateline to exercise option clearly indicated . All the terms and conditions in the standard booking form shall be explained to the intending purchasers before the developer collects any form of booking fee .
This standard approach to booking fee will legitimize collection of booking
PROPERTY360DIGEST E-MAGAZINE ISSUE # 6