Another property management law? Fix the gaps, don't duplicate the regulator

The Housing and Local Government Ministry (KPKT) recently mooted a Building Managers Act to introduce dedicated legislation on property or building management.

Nobody would dispute that good property management is essential. Poorly managed buildings deteriorate, property values suffer, maintenance is neglected and owners ultimately bear the cost. However, the answer to poor management should not automatically be another Act or another registration regime.

Before creating a new regulatory framework, the government should first ask a fundamental question:

1) Do we actually have a regulatory vacuum, or are there gaps, weaknesses or enforcement deficiencies within the regulatory frameworks that already exist?

This distinction is critical.

The Board of Valuers, Appraisers, Estate Agents and Property Managers (BOVAEP), under the Ministry of Finance, already regulates the professional practice of property management within the statutory framework of the Valuers, Appraisers, Estate Agents and Property Managers Act 1981 (Act 242).

Concerns have also been raised that separate regulatory structures could result in duplication, jurisdictional conflict and uncertainty for stakeholders.

2) Why create another register for building managers without first defining the regulatory gap it is intended to fill?

A shortage is not the same thing as a regulatory vacuum

At the International Strata Symposium on April 8, 2025, KPKT Minister Nga Kor Ming said there were 594 firms licensed to practise property management serving 26,334 strata schemes involving about 2.91 million strata units nationwide.

He cited these figures as evidence of an insufficient supply of licensed firms and linked the shortage to poor service and the proliferation of unlicensed and unqualified property managers.

At the launch of the National Housing Policy 2026–2035 on Aug 10, KPKT said it planned to draft and amend four housing laws.

If the proposed Building Managers Act were to proceed, its precise scope, functions and relationship with the existing regulatory regimes under Act 242 and the Strata Management Act 2013 (Act 757) should first be made clear.

The figures certainly deserve attention. But they do not necessarily justify creating a new regulatory regime. If there are insufficient licensed property managers, the government should first investigate why there is a shortage.

a) Are there insufficient training opportunities?

b) Are the qualification requirements too restrictive or insufficiently flexible to recognise appropriate alternative pathways without compromising professional standards?

c) Is registration too cumbersome?

d) Are remuneration levels unattractive?

e) Are young professionals reluctant to enter the profession?

f) Is enforcement against unlicensed practice sufficiently effective?

g) Or has demand for professional management grown faster than the supply of qualified practitioners?

These are manpower, training, market and enforcement questions. They are not necessarily problems requiring a new Act.

More fundamentally, creating a second register does not itself increase the number of competent practitioners. If the same pool of people is merely transferred, duplicated or reclassified under another register, the numerical shortage remains.

If a new pathway were created for people who do not currently meet the registration requirements applicable to property managers under Act 242, it would also be necessary to ensure that competency and professional standards were not weakened.

3) Does creating a new register actually create more qualified property managers?

Why duplicate a function already entrusted to BOVAEP?

Parliament has already provided under Act 242 for the statutory regulation of the professional practice of property management.

Act 242 provides statutory machinery for the registration and regulation of property managers and property-management practice, including professional and disciplinary requirements.

Following the 2017 amendments, the board opened a 12-month transitional registration exercise from Jan 2, 2018 for existing practitioners, subject to the qualifications, experience and other requirements prescribed by the board.

The government should therefore explain precisely what is missing from the existing framework.

a) If there are deficiencies, amend Act 242.

b) If enforcement is inadequate, strengthen enforcement.

c) If registration pathways are unnecessarily restrictive, reform them without compromising competency and professional standards.

d) If there are insufficient professionals, expand training and recruitment.

e) Where people are carrying out activities that fall within regulated property-management practice without the registration or authority required by law, enforce the applicable law.

f) If there are genuine building-management functions falling outside Act 242, identify and define those functions before legislating.

That last distinction is particularly important. A genuine regulatory gap should be filled. But filling a demonstrable gap is fundamentally different from establishing a parallel registration regime covering functions already regulated under Act 242.

Creating an entirely new statutory regime without clearly delineating its functions could result in two authorities regulating substantially similar professional activities. Rather than resolving regulatory problems, it risks creating duplication.

Two registers could create two classes of managers

Suppose KPKT establishes a register of building managers while BOVAEP continues maintaining its existing register of property managers.

What will be the precise distinction?

i) Will a building manager be allowed to perform the same functions as a registered property manager?

ii) Will both be permitted to manage strata developments?

iii) Will a management corporation (MC) be able to appoint either one?

iv) Will there be different qualification requirements?

v) Will there be different fees?

vi) Will there be different disciplinary procedures?

vii) Will one regulator recognise the other's qualifications?

viii) Will a person or firm registered under Act 242 also have to obtain a second registration under the proposed legislation?

ix) Will professional indemnity insurance, competency requirements and professional standards be equivalent under both regimes?

How would overlapping functions and responsibilities under the two regimes be reconciled?

And most importantly:

4) Who will have regulatory jurisdiction when the functions governed by the two regimes overlap?

These questions cannot be brushed aside.

A property owner should not have to understand the bureaucratic architecture of the government merely to determine whether the person managing his or her building is properly qualified. Regulation should make matters clearer, not more complicated.

Nor should a competent practitioner already regulated under one federal statute be subjected unnecessarily to overlapping licensing, registration, disciplinary or compliance regimes administered under separate regulatory frameworks.

Strata management is already governed by legislation

The issue becomes even more complicated when dealing with strata properties.

Act 757 already establishes a substantial statutory framework for the management of strata developments.

It provides for joint management bodies (JMBs), MCs, subsidiary MCs, the commissioner of buildings (COB), maintenance accounts and sinking fund accounts, collection of charges and contributions to the sinking fund, committee meetings, general meetings, additional by-laws and dispute resolution.

Act 757 broadly regulates the governance and administration of strata schemes, whereas Act 242 regulates the professional practice of property management. These statutory functions are related but conceptually distinct. Any new legislation must first identify what is not adequately covered by either framework.

When a strata building experiences management problems, we must identify the precise failure.

a) Is the problem within the JMB or MC?

b) Is it the COB?

c) Is it a person carrying out property-management functions without the registration required under the applicable law?

d) Is it poor enforcement?

e) Is it non-payment of maintenance charges?

f) Is it inadequate participation by parcel owners or proprietors?

g) Is it a shortage of professional property managers?

h) Is it inadequate competency or training among those involved in day-to-day building operations?

i) Or is it a weakness or ambiguity in Act 757 itself?

Different problems require different solutions.

A new Building Managers Act could add another layer to an already complicated statutory landscape unless its functions and jurisdiction address clearly identified gaps that cannot adequately be dealt with under existing legislation.

The case for reform may well exist. But the government should first identify the regulatory failure it is seeking to address, determine whether it can be dealt with by strengthening the existing framework, and clearly define any functions that genuinely fall outside Acts 242 and 757.

New legislation should fill an identified gap, rather than create a parallel regime covering functions already regulated under existing law.

This is the first of a two-part article, with Part 2 to be published later.

This article is written by Datuk Chang Kim Loong, honorary secretary-general of the National House Buyers Association (HBA). HBA is a voluntary non-governmental and not-for-profit organisation manned wholly by volunteers.

HBA can be contacted at:
Email:  [email protected]
Website: www.hba.org.my
Tel: +6012 334 5676

The views expressed are the writer’s and do not necessarily reflect EdgeProp’s.

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