Housing

Good and cheap houses

<i>SPNB chairman Idris Haron (right) discusses the dos and don'ts of building mesra houses with contractors (from left) Johnny Gatasin, Bibi Zairah Alli Alladad, Penampang district officer William Sampil and assistant local government and housing minister Donald Mojuntin.</>

Agency says building contractors have no reasons to cut corners

By Nurhafizah Yusof and Joy Akang
Pictures by Victor Lo and Ng Jia Xiang

<i>Hajiji Noor</i>Buyers have always complained of poor quality houses because building contractors cut corners, according to Idris Haron, chairman of Syarikat Perumahan Nasional Berhad, the national housing company. And he has offered two solutions to builders that he hopes will ensure good and cheap houses for the poor: He forbids them from sub-contracting their projects while his company will no longer retain 5% of their contract money as a guarantee against building defects.

Idris says sub-contracting is one reason for poorly built houses. Contractors work on very thin margins particularly for low-cost houses costing about 66,000 ringgit ($21,710) each under the government Rumah Mesra Rakyat (friendly people’s housing) scheme.

They stand to make between 10% and 15% if they build the houses themselves. But if they sub-contract it to another for the same price, it is clear that the sub-contractor will have to cut corners to make a profit.

Idris says his company has also found that the 5% retention money on project completion has proven to be a disincentive to contractors. This money is meant to ensure that contractors build houses according to specification and rectify any defects before his company releases the money to them at the end of the one-year warranty.

<i>Wan Maimunah</i>Instead contractors feel that they will not get this money and so they cut corners in order to compensate themselves for what they have given up as a loss on the contract price.

Idris says his company has since January abolished the retention money. “The reason is to give the contractors some breathing space and encourage them to build houses properly,” he says.

But he warns contractors that they will not get another job if they are caught cutting corners.

Idris was in Kota Kinabalu to hand out letters of intent to 28 contractors to build more than a hundred mesra houses in Papar, Tuaran, Sepanggar and Penampang.

Hajiji Noor, Sabah housing and local government minister, says 645 of the 1,723 applications for mesra houses costing about 44m ringgit have been approved. The federal government has approved 18,000 applications for these houses costing about one billion ringgit for the whole country.

Families who earn less than 1,500 ringgit a month are eligible for them. They pay a monthly instalment of 150 ringgit for 22 or 25 years for a subsidised house with an area of 65 square metres (700 square feet). The government pays 30% of its cost.

However building contractor Wan Maimunah Wan Muhammad, 43, says there is money to be made in building mesra houses. Her company, Pasti Maju Enterprise, has been in the construction business since 2003. – Insight Sabah

Posted on April 23, 2011

Malay 中文
Bookmark and Share
Your Comment

Your email address already exist, please sign in to post your comments

Fields marked with (*) are REQUIRED
CAPTCHA ImageReload Image
Latest Comments
  • House application

    By Johanah on 17-07-2011 03:30 am

    Where and how i can apply for this house?

In pictures
Heart of Borneo International Conference

Heart of Borneo International Conference

View

CM accompanies DPM on working visit to Vietnam

CM accompanies DPM on working visit to Vietnam

View

DPM dialogue session with Sabah Bumiputera entrepreneurs

DPM dialogue session with Sabah Bumiputera entrepreneurs

View

Quotes of the Day
Most popular
What's on