Weaknesses in the recently completed draft Condominium Law need to be addressed before it can be promulgated, according to officials from the Department of Human Settlement and Housing Department (DHSHD).
Although it is targeted to become law this year, some in the industry have pointed to a number of problems with the current draft.
Virtually all of Yangon’s recently constructed “condos” are not considered condominiums in the draft law as they were not built on freehold or grant land, according to one reading of the law.
“The condo law should clearly set out minimum ownership standards [for the land] to decide what is a condo,” said Daw Moe Thida, assistant director of the housing department under the DHSHD.
“We will submit the law to responsible departments, who will go through it point by point. There are some weak points compared with other international condominium laws,” she added.
The draft Condominium Law had made it as far as the hluttaw before government officials were requested to take another look.
Although the land ownership question is one main concern with the draft, there are a number of other areas needing attention, according to experts.
Daw Moe Thida also said extensive condominium management rules are also not included in the law.
“There are some weak points with condo management. We will point out all the weak points in the law and will upgrade it to make it better,” she said.
Foreign buyers will also be able to own some units in condominiums, but under the current draft only in condos built on freehold and grant land, according to DHSHD Department of Urban and City Planning director Daw Aye Aye Myint.
With most so-called “condominiums” being built on leased land rather than grant or freehold land, they would be off-limits to foreign buyers under the draft law.
“It’s a big question for foreign buyers. Under the former law they couldn’t own land or houses, but in a [revised] condominium law you could see foreigners being allowed to buy condos,” she said.
Moreover, it needs to be clearly laid in the law out how to register land ownership with the DHSHD or Yangon City Development Committee, she said.
Built-Operate-Transfer plans are also often used for new investments, and rules governing this should also be included in a law, said Daw Aye Aye Myint.
What happens when the lease expires is not clear, particularly whether the government will give new leases or extensions to the tenants after the full 70 years currently allowed.
Myanmar Real Estate Service Association general secretary Daw Moh Moh Aung said there are many questions left unanswered, blaming it partially on the self-interest of some drafting the bill.
There are many concerns from developers that the government drafting teams did not address, she said. For instance while condos built on freehold or grant land can be mortgaged, she would like to know if ownership of a condo built under BOT terms can similarly be used as collateral.
“We have to get the best solution from all different sides,” she said.
Source: Myanmar Times