Speed is key when it comes to collecting maintenance fees

Good and timely maintenance is key to the continuous appreciation of property prices. However, this is an issue with many affordable high-rise units today.

Without a strong management team to collect the monthly fees from home owners, there will be shortfalls and this means maintenance suffers.

After a while, the wear and tear becomes critical and by then the maintenance problems becomes impossible to fix, even assuming the majority of owners pay after that.

This is why when the 100,000 affordable homes are built this year, plans must be made in advance so management does not find themselves in a pickle when maintenance starts to suffer due to unpaid maintenance fees.

Fortunately for us, Housing and Local Government Minister Zuraida Kamaruddin says the ministry is prepared.

In an article in edgeprop.my, Zuraida said team members under the Ministry itself would be given training to look into the management of affordable housing projects. This will include their upkeep and the collection of maintenance charges.

She said, “The management of the properties is very important because if you’re talking about the B40 group, this category comprises working class people. So they can’t afford to pay high maintenance fees and spend time to manage the properties.”

She said the formation of the team was in line with the National Community Policy or Dasar Komuniti Negara (DKN).

DKN was formulated by the Ministry to improve the living standards of residents living in public affordable housing units.

She said the National Housing Policy outlined five areas of focus, 16 strategies and 57 action plans. Moreover, her focus for the next five years will be to help the B40 group own a home.

Be that as it may, we still need to address the financial aspect of this issue.

We have to understand that if the maintenance fee is fixed at RM100 and it’s one month overdue, the owner may still be able to pay.

However, if we do not collect this fee on time and we only chase for payments after six months, then RM600 is a huge amount to cough up for many owners. The reason? They may have already spent the money on something else which depreciates in value.

Speed is of the essence when it comes to collecting maintenance fees. After collection, comes the actual job of maintaining the property itself.

The team formed by the Ministry must have a good understanding of facility management as well because if they do not spend the money correctly, it will spell trouble in the future for high-rise affordable developments.

This article first appeared in kopiandproperty.com

Charles Tan blogs at property investment site kopiandproperty. He dislikes property speculators and disagrees that renting is better than buying. He thinks it’s either property or poverty. He is presently the CEO of an auction house auctioning assets beyond just properties.