Housing Ministry Studies Option to Purchase Clause to Reduce Risk of Abandoned Projects
Proposed Mechanism Aims to Give Buyers and Developers Greater Flexibility Before Signing Agreements
KUALA LUMPUR — Ministry of Housing and Local Government (KPKT) is studying a proposal to introduce an “Option to Purchase” (OTP) clause under the new Real Property Development Bill as part of efforts to reduce the risk of sick and abandoned housing projects in Malaysia.
Housing and Local Government Minister Nga Kor Ming said the mechanism would provide greater flexibility for homebuyers and developers to withdraw before signing the Sales and Purchase Agreement (SPA).
According to him, the proposed measure would help both parties minimise financial commitments and legal risks during the early stages of a project.
He said the initiative would also allow developers to better assess actual market demand and project feasibility before construction progresses further.
“This move can help avoid situations where developers face financial difficulties if sales performance turns out to be weaker than expected midway through construction,” he said while speaking at the StarProperty Awards 2026 last night.
According to Nga Kor Ming, the mechanism is expected to help reduce the risk of delayed, sick and abandoned housing projects as well as unsold property units caused by insufficient buyer demand.
He said the initiative forms part of the broader Reformasi Perumahan Madani agenda aimed at modernising Malaysia’s housing regulatory framework and ensuring long-term industry sustainability.
In a related development, he said Malaysia’s property sector recorded strong growth in 2025 with transactions exceeding RM240 billion, the highest level in a decade.
According to him, the achievement reflects growing market confidence driven by political stability and favourable economic conditions.
Nga Kor Ming also revealed that KPKT’s special task force on sick and abandoned housing projects has successfully revived more than 1,500 projects since December 2022.
He said the revived projects involved a gross development value (GDV) exceeding RM140 billion and benefited more than 176,000 homebuyers nationwide.
Apart from legal reforms, he said KPKT is also accelerating digital transformation initiatives within the housing ecosystem through platforms such as e-SPA, Teduh and the Housing Integrated Management System (HIMS).
According to him, these efforts are intended to improve efficiency in housing management systems while enhancing transparency within the industry.
“We are targeting zero sick housing projects by 2030, and achieving this goal will require cooperation from all stakeholders, including industry players,” he said.
He also reaffirmed the government’s commitment to ensuring Malaysians continue to have access to quality, sustainable and affordable housing through close collaboration between the public and private sectors.
-wilayah.com.my
