13 November 2014 - The Consumer Council issued their latest study on the sales of first-hand residential properties, criticizing the new sales regulations adopted since last April for not eliminating undesirable sales practices in the market, including multiphase sales arrangements, advanced cheque payment offered by real estate agents, and general high-pressure sales tactics.
In the report, the Council made 8 recommendations, with the advice to ensure all units on provided price lists are available for sale concurrently, to lengthen the ‘cooling-off period’ to 7-14 days, to reduce the forfeiture amount to 1-3%, and to increase the number of inspections by ‘mystery shoppers’ in a bid to conduct prosecutions, etc. Despite the high number of cases reported, no prosecution has been recorded since the adoption of new sales regulations.
Eugene Fung, Director of the Sales of First-hand Residential Properties Authority replied that they have completed investigations on a number of cases, and have passed the results to the Department of Justice for prosecution decisions. Regarding the 8 recommendations by the Consumer Council, Fung said they will carefully study the report, but he believed the issues of multiphase sales arrangements and the length of the ‘cooling-off period’ had already been fully discussed during the legislative process.
Director of The Real Estate Developers Association of Hong Kong Stewart Leung disagreed with the result of the Consumer Council’s report. He mentioned the Council had been participating since the first draft of the regulations, and had no communication with developers when preparing the report. He added that sales of new developments strongly depend on the market’s absorbability, hence he disagreed with the Council’s suggestion of selling all available units at one time.
Click here for a full version of the report in English.
