How can we better protect new launch buyers against marketing gimmicks?
A scenario of a home buyer visiting a sales gallery
Alfred walks into a Property Expo at an esteemed exhibition convention centre, looking for his dream home after saving enough money from years of working. As he meanders through aisles of exhibition booths thronged and packed with visitors, he is particularly attracted to a particular developer’s promotional booth.
The booth is impressively designed and showcases one of the most comprehensive ranges of property developments on offer within and outside of the Klang Valley. After scrutinizing and sieving the brochures and pinned-up sales exhibits on the various properties on offer, Alfred even took the effort to visit the developer’s actual sales gallery which has a real size mock unit albeit of a similar type with similar spaces; he finally picked a condominium unit.
Hugely impressed by the colourful digital images, and perspectives, cut through miniature-scaled building models of his future condo unit and walked through the digital presentation. Alfred is convinced he has finally found his dream home and happily signs off the dotted lines in the sales & purchase agreement in the presence of the developer’s panel lawyers.
The harsh reality of “artist impressions” when buying property
Alfred eagerly waited for the construction to complete including the issuance of the requisite certification of compliance by the developer’s architects evidencing that the condo unit is deemed fit for occupation.
Alfred soon finds out the harsh reality when he takes delivery of vacant possession of his condo unit and finds out to his shock that “what you see is not what you get”!
When he walks through the door, he finds that the condo unit is not as spacious as depicted in the images or walk-through presentation. Without the furnishing, the living room and dining do not look half as impressive!
He suddenly finds out there is a boxed-up rainwater down pipe in the otherwise perfectly rectangular living; now there is an odd boxing protrusion at the corner! At the high ceiling of his dining, there is an unsightly sanitary elbow which the plaster ceiling fails to cover up! The bathroom ceiling level is lower than those shown in the images!
The walls are not flat, and the workmanship is not half as immaculate as those conveyed in the sales exhibits!
His yard is tiny or minuscule! There is an unsightly sprout pipe sticking from his balcony! the scupper drain at the balcony was so shallow that it is also at the same level as the balcony slab and causes his balcony to flood whenever the drain is overwhelmed by the rainwater! The list of mismatched expectations goes on…… and the list has not even included the defects list synonymous with the ills of the housing development industry!
When Alfred complains to the developer, they tell him that boxing for the rainwater downpipe is a construction necessity and industry standard practice! The sanitary elbow at the high ceiling of the dining is due to the proximity of the washroom on the upper unit!
On the pretext of justification, they tell him the difference in ambience is due to the enhancement of the furnishing and since Alfred did not purchase the furnishing package, he cannot expect such ambient!
As for the perception of spaciousness of the condo unit, the spaces are generated through the digital software based on the actual dimensions, there is nothing they can do about it!
Further, complaints about the disparity in expectation by Alfred are met with the pointing out of the ever-present “artist impression” clause in the fine print of the brochure. This has been a nightmare scenario for Alfred but also for many naïve and unwary purchasers after investing their hard-earned savings.
When Alfred wanted to make references to the mock-up unit, he was told the unit was demolished following the conclusion of the promotional sales. Subsequently, the developer’s sales agent remarked: ‘There are ‘Disclaimer of Liability’ posted on the main door to the show units; hence, they are not responsible for any alleged misleading or misrepresentations.
Such ‘mismatched’ expectations between the ‘show units’ and the ‘actual units’ have become fertile grounds for contention between developer and purchaser.
Discover properties for saleHow can we protect home buyers from inaccurate artist impressions?
So, is there a way for us to address this deficiency in the system and make sure purchasers get “what you see is what you actually get”?
The most effective way is for the developers to provide a real-size mock-up replica for each type of property on sale for housing accommodation, any other scaled model is just not enough! The promotional sales brochure with digitally generated images and walk-through presentations are mere supplementary at best!
It is in the interest of the developers to provide such a real-size replica to enable the purchasers to view and experience the actual ambience of the condominium unit be it fully furnished or otherwise. This is to enable the purchasers to know exactly what they are buying to avoid any possible future disputes due to cross-expectations.
Such ‘mock-up’ units shall be fitted and complete with the exact specifications such as building materials, sanitary, plumbing, and electrical fittings as agreed in the sales & purchase agreement.
These ‘mock-up’ units could then be displayed based on a typical type with bare finishes or an optional enhanced unit package complete with full furnishings, if any. This will leave no room for subjective interpretation of each of the packages on offer.
Do we need to regulate the show units developed by developers?
Since we are in the freedom to contract/ trade democracy, we cannot force and make the provision of real-size mock-up units compulsory for the developers. But then should they choose to provide these replicas to enhance their sales and marketing, such provision ought to be regulated under the Housing Development (Control & Licensing) Act 1966. Perhaps, a new set of HD Regulations termed: Show Units Regulations and Compliance?
This is to specify, in no uncertain terms, that these mock-up units are built according to the dimensions and specifications approved by the local authorities as well as those agreed in the sales & purchase agreement with sanctions and punitive actions to be taken against non-conforming housing developers and their sales agents from enticing and inducing purchasers into a sales deal by false and imaginative description or inaccurate specifications.
These mock-up units can either be constructed in the designated condo units in the actual building premises or independently built and kept in the developers’ sales gallery for a stipulated period after the delivery of vacant possession, this will enable the purchasers to benchmark it against the actual unit built and delivered to them. In this way, any dispute over the discrepancy can be addressed accurately and expeditiously.
It is recommended that such mock-up units are built in a building with specification plans approved by the Local Council and their completion be certified by the appointed architects.
There should be nothing hidden. The way something is displayed in the show unit is the way it will eventually be delivered – ‘lock, stock and barrel’.
If in this way, even if the purchasers do not get a perfect “what you see is what you get“, they will not be too far away from getting one!
*This article is jointly written by National House Buyers Association (HBA) honorary secretary-general Datuk Chang Kim Loong and technical advisor Ar. YS Ng. HBA is a voluntary non-government and not-for-profit Organization manned wholly by volunteers.