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Sunday, March 23, 2014

Bumi Lot to Non-Bumi Lot Conversion


Bumi Lot to Non-Bumi Lot Conversion

March 7, 2010



Generally, the position vis-à-vis the sale of a condominium unit where the original purchaser is a bumi may be divided into 2 situations :-
(a) where strata title to the condominium has been issued
In this situation, the Vendors or his solicitors will have to ascertain whether the Master Title contains any restrictions in interest which prohibits the transfer of the property without the State Authority’s consent. Borang Jadual 3 (Penyata Daftar Strata) which is attached to the Strata Title will state whether there’s such restrictions. If there is such restrictions, invariably any application for the consent to transfer from a bumi vendor to a non-bumi purchaser will not be approved by the State Authority. The vendor may however appeal against such non-approval.
Where there’s no such restriction endorsed on the Master Title, the parties may proceed with the sale transaction and the transfer in favour of the non bumi purchaser will be registered by the relevant Land Office/Registry provided the necessary documents to register the transfer are in order.
(b) where the strata title has not been issued
In this situation, if the Vendor intends to sell the unit to a non bumi, the Vendor or his solicitors should get the Developer’s confirmation whether the unit is under the bumi allocation. If so it’s not advisable to proceed with the sale to a non bumi as the transfer in favour of the non bumi purchaser may be rejected by the Land Office/Registry when it’s presented for registration upon issuance of the Strata Title.
In cases where the strata title has not been issued, apart from the condition on the bumi quota normally imposed in the Development Order (“DO”), there is no written rule prohibiting the sale of the unit by a bumi vendor to a non bumi purchaser but as compliance with the quota requirement in the DO may effect the process of getting the consent to transfer (where the developer has not obtained a blanket consent) and Strata Titles issued by the relevant authority, most developers will advise the parties whether the particular unit may only be sold to a bumi to avoid any possible complication in their application for the said consent and/or issuance of the Strata Titles.
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2 comments:

  1. Just some sharing,
    No matter it is bumi lot or not, it is a silent rule that land office normally will reject the first trial if it is selling from bumi to non-bumi.

    I am not sure about conversion. I know bumi lot can be released to non-bumi buyer. However, the status of the house is still bumi lot.

    Source: http://loanstreet.com.my/learning-centre/Bumi-Land-Jargons-Explained

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  2. Thank you for the sharing. This reference will surely help potential buyers to be more alert when they consider buying a property.

    ReplyDelete