Condo by-laws due in De­cem­ber

The Myanmar Times - - Front Page - – Trans­la­tion by Win Thaw Tar za­yarlinn@mm­times.com ZAY YAR LINN

The re­lease of by-laws that will al­low sales un­der the Condominium Law have been de­layed un­til the end of the year as the gov­ern­ment seeks more ex­pert ad­vice.

A SHORT­AGE of tech­ni­cal ex­per­tise has de­layed the is­suance of by-laws that would al­low sales un­der the Condominium Law passed last Jan­uary, in­dus­try sources say.

Ex­pec­ta­tions that the law, which was fi­nally passed after con­sid­er­able de­bate and de­lay, would usher in a spate of for­eign pur­chases of Myan­mar real es­tate have so far proved un­founded.

U Min Htein, di­rec­tor gen­eral of the Depart­ment of Ur­ban and Hous­ing Devel­op­ment of the Min­istry of Con­struc­tion, told The Myan­mar Times on Oc­to­ber 10 that dis­cus­sions were still pro­ceed­ing with ex­perts in an ef­fort to com­plete and re­lease the by-laws in De­cem­ber, set­ting out de­tailed reg­u­la­tions and pro­ce­dures.

“The de­lay in re­leas­ing the by­laws re­sults from the scarcity of ex­perts in Myan­mar. We have to co­or­di­nate with the rel­e­vant min­istries and or­gan­i­sa­tions as well. We will put the draft to the At­tor­ney Gen­eral’s Of­fice be­fore re­port­ing back to the cab­i­net. We are try­ing to re­lease the by-laws in De­cem­ber,” he said.

The con­struc­tion min­istry first started work on the draft condo law in 2013, un­der the pre­vi­ous gov­ern­ment. The draft shut­tled back and forth be­tween the up­per and the lower houses as amend­ments were in­tro­duced and de­bated be­fore it was passed in the last week of Jan­uary.

How­ever, the ab­sence so far of the nec­es­sary by-laws re­quired for im­ple­men­ta­tion has pre­vented the law from en­ter­ing fully into force.

Po­ten­tial would-be buy­ers, whether in Myan­mar or from over­seas, have adopted a wait-and-see at­ti­tude as they await the is­suance of the by-laws.

Daw Moh Moh Aung, gen­eral sec­re­tary of the Myan­mar Real Es­tate Ser­vices As­so­ci­a­tion (Cen­tral), said the ex­act po­si­tion had to be clearly set out in de­tail be­fore the mar­ket could warm up again.

“Although peo­ple are now al­lowed to buy con­do­mini­ums above the sixth floor, few have ac­tu­ally bought a condo so far. They’re wait­ing for clar­ity on whether for­eign buy­ers can buy in col­lab­o­ra­tion with the banks,” she said. “Banks may of­fer mort­gages for con­dos built on pri­vate land if they have a spe­cific land area and com­ply with other stip­u­la­tions in the Condominium Law.”

But banks have said they will not of­fer a mort­gage in the case of con­dos built un­der the build-op­er­ate-trans­fer (BOT) sys­tem, Daw Moh Moh Aung said.

“That’s prob­a­bly why sales are lag­ging. For­eign­ers will prob­a­bly buy BOT con­dos if they can get a bank loan. The by-laws should make it very clear what kind of visa a for­eign buyer needs in or­der to pur­chase a condo.”

Re­stric­tions in the law in­clude the need for the build­ing to oc­cupy at least 20,000 square feet of land. For­eign­ers can buy apart­ments only above the sixth floor, in build­ings where no more than 40 per­cent is for­eign-owned.

Chap­ter 5 of the law, on reg­is­tra­tion and build­ing, says build­ings con­structed on col­lec­tively owned land reg­is­tered with the Doc­u­ments Reg­is­tra­tion Of­fice have been de­fined as con­do­mini­ums.

Ac­cord­ing to that chap­ter, a de­vel­oper wish­ing to regis­ter a build­ing as a condominium should regis­ter with the DRO and then trans­fer the land to peo­ple per­mit­ted to own land col­lec­tively.

“Banks can­not of­fer mort­gages un­til the by-laws have been passed,” said U Win Zaw, man­ag­ing di­rec­tor of the Con­struc­tion and Hous­ing Devel­op­ment Bank. “The main hold-up is the ques­tion of own­er­ship. The condo by-laws will al­low peo­ple to own land. Ac­cord­ing to the condo law, if the land has not been reg­is­tered, there is no owner and no work can be done on un­reg­is­tered land. It’s not true that banks don’t of­fer mort­gages on BOT con­do­mini­ums. This should be clear once the by-laws have been is­sued.”

‘The de­lay in re­leas­ing the by­laws re­sults from the scarcity of ex­perts in Myan­mar.’

U Min Htein Con­struc­tion min­istry

Photo: Zarni Phyo

With the im­ple­men­ta­tion of the condo law for­eign­ers can buy units in projects such as the Di­a­mond Inya Palace Condominium in Yan­gon.

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