"Bay' Bithaman Al-Ajil (BBA) in house financial practiced by bank in Malaysia is a shariah compliant product": Is it true?

It is trite practice in Malaysia that for some who wish to purchase a house, especially a transaction falling under the Housing Development (Control and Licensing) Act 1966(Act 1 18), they would seek to obtain a loan from an Islamic bank or the Islamic Window Bank (IWB). Before the purchasers apply for a housing loan from an Islamic Bank or IWB, they should have entered into agreements of sale and purchase (Schedules G, H, I or J) ('the said agreement') with the developers. Once the said agreements are executed and enforceable, the purchasers may apply for loans from an Islamic Bank or IWB to finance the balance purchase price of the property.The effect this housing transaction, the purchasers are required to execute two agreements to facilitate this, firstly, the Property Purchase Agreement (PPA) and secondly, the Property Sale Agreement (PSA).This method is known as Bay' Bithaman al-Ajil (BBA). Nonetheless in the writers' opinion, the BBA on housing purchase as practiced in Malaysia may not be valid on the ground of elements of gharar contained in it, especially when facing the problems of abandoned housing projects. Hence, this paper elaborates on the elements of gharar which may vitiate the legality of the BBA itself. Following this, the writers will suggest ways to improve the current practice of BBA in housing transactions practised by Islamic Banks and IWB in Malaysia