Developers asked to pay security deposit on jointly owned buildings

FOR construction of jointly owned buildings, developers will now have to hire an appraiser and deposit 15 per cent of the estimated value of the property with a bank, according to the Yangon Region Collectively Owned Buildings Construction Management Committee.

“Currently, developers don’t have an appraiser to calculate the partial value of jointly owned buildings. So, they are not being issued construction licenses for building jointly owned buildings. They have already submitted a request to the authorities concerned to hire an expatriate partial value appraiser. Additionally, developers will have to make a 15 per cent security deposit at a bank. The purchasers will also have to deposit money at the same bank. We are having discussions now related to when a deposit can be withdrawn from the account, and also, how it can be withdrawn,” said U Myo Myint, a member of the committee.

If the matter of appraising the partial value can be resolved, developers who have already constructed buildings according to the Condominium law will not have to make the 15-per-cent security deposit.

“Currently, we are making arrangements for developers to hire a partial value appraiser in Myanmar. Construction licenses are expected to be issued at the end of September to those who are holding a license for construction of jointly owned buildings,” said U Myo Myint.

“We’ve asked them to deposit 15 per cent for the sake of safety. But, we haven’t decided on a bank yet. When the bank has been chosen, they will have to deposit 15 per cent with that particular bank, and the purchasers will also have to deposit money with the same bank,” he said.

The collectively owned buildings law was enacted on 29 December, 2016, and its provisions have been amended several times since then. Under the law, foreigners are permitted to purchase apartments, but foreign ownership of jointly owned buildings cannot be more than 40 per cent.

“Currently, we cannot sell apartments to foreigners because developers are facing difficulty in calculating the partial value,” said U Myo Myint.

Moreover, jointly owned buildings must be over 20,000 square feet wide. And, the buildings must have more than 6 floors, a lift, an assembly place, and waste disposal system.

Up till now, construction founder licenses for jointly owned buildings have been issued to 30 local companies and two foreign companies. Construction permits for jointly owned buildings will be issued at the Collectively Owned Buildings Construction Management Committee Office soon, it is learnt.

Source: Global New Light of Myanmar

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