Property owners and developers appear to be reluctant to apply for strata titles despite the roadshows conducted by the Land Department, Ministry of Development to highlight the benefits of strata ownership.

Since the law on strata titles came into force in 2009, the total number of applications to subdivide buildings for the production of strata titles clearly shows it is still' at "a less than favourable rate" and "not very encouraging", the department said in a statement yesterday.

Only two lots of land throughout the country have been registered with strata ownership, of which 42 pieces of strata titles have been issued.

The Land Code (Strata) Chapter 189 was approved in 1999 by the consent of His Majesty Sultan Haji Hassanal Bolkiah Mu'izzaddin Waddaulah ibni Al-Marhum Sultan Haji Omar 'Ali Saifuddien Sa'adul Khairi Waddien, Sultan and Yang Di-Pertuan of Brunei Darussalam and had come into force on July 1, 2009.

The Strata Act was enacted in order to allow anyone to own property in the form of units in a building in Brunei Darussalam, the department said.

The department said the reluctance to apply for strata titles is likely due to the following factors:

The landowners do not feel confident that strata title ownership will guarantee ownership and benefit them.

- The issuance of strata title is not compulsory.

- Most of the lands that have multi-storey buildings were around long before the Act came into force, and the owners are more comfortable with the present method of lease or rental agreement for a contract.

- The landowners/developers think that stratifying their land is an expensive and time-consuming application process.

- 'There is a lack of public confidence to venture into the strata property market investment as it is still considered new in this country.

In view of the situation, the department is encouraging the people to venture into the strata property investments either as the landlord or real estate developer in accordance with the provisions of the Land Code (Strata) Chapter 189.

The Land Code (Strata) Chapter 189 allows owners to subdivide the building lots that have more than two main units, either vertically or horizontally. This creates the issuance of separate titles called strata titles that can be owned by anyone for each individual units within a building. However, the building subdivision approval must be obtained first and the building must be completed as well as gain Occupation Permit (OP) from the relevant authority.

The main purpose of introducing the Act is to open the property market in the form of units within a building. This includes residential flats, commercial buildings and other buildings with special conditions of land ownership that were allowed stratification.

It is expected to generate economic development by encouraging the growth of the construction industry and attract investors both inside and outside the country in the real estate sector.

The department said for the strata ownership, strata titles or subsidiary grants will be issued to owners registered in the Strata Registration Book. The grant will have a lease term of not more than 99 years (for freehold land). As for the original land grants held on lease, the strata titles should be no more than one day less than the land lease and the remaining term of the lease shall be not less than 20 years.

With the issuance of strata titles, unit owners can sell, give, bequeath, lease and sublease their units to anyone. Strata grants can also be used as security for loans (as collateral) as allowed under section 23 of the Land Code (Strata) Act.

Anyone can be eligible to apply for strata ownerships, whether they are citizens of Brunei, permanent residents or foreign nationals. It is subject to the consideration of relevant authorities that approves applications for strata title ownership.

The land that is to be developed with strata titles must have authorised Special Conditions Land only, such as residential flats, commercial buildings and so on. The building on the land must be completed and have been issued an occupation permit (OP) from the relevant authority prior to obtaining subdivision approval.

Strata title ownership applications will only be considered if it is within a period not exceeding 99 years (for freehold land).

As for the original land lease, the strata titles should be no more than one day less than the land lease and the remaining term of the lease shall be not less than 20 years.

When strata titles are issued, then the ownership of the land where the building is on still remains in the name of the owner and the Strata Corporation will automatically come into existence in the name of the owner of the land of which the strata titles were issued on.

Members of the Strata Corporation are made up of registered owners of the main strata units. Unit owners are responsible for managing each individual units owned. As for the overall building, it will be in the responsibility of the Strata Corporation. In Strata Corporation dealings, each unit owner has the unit right share (unit entitlement) in accordance with the unit that was set during the subdivision applied by the original land owners.

In implementing the Land Code (Strata) Chapter 189, His Majesty has consented for the agents of land valuation and real estate agents in the country to carry out the duties and services as 'managing agent' for each unit that can be regulated with strata management, the Land Department said. With that, Valuers and Estate Agents Order, 2009 has been allowed to take effect from July 1, 2009.

Source:
@BRUDIRECT.COM

by BruDirect.com

If you have any stories or news that you would like to share with the global online community, please feel free to share it with us by contacting us directly at [email protected]