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Underhanded property sellers targeted

0 CommentsPrint E-mail China Daily, March 23, 2011
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China's top economic planner told developers and real estate agents on Tuesday not to use underhanded means to sell property, as Beijing continues efforts to cool the country's real estate market.

Anyone trying to sell a property "must not use false or nonstandard price labels to mislead property buyers", the National Development and Reform Commission said in new rules that take effect on May 1.

The regulations are aimed at making prices more transparent to protect both property buyers and sellers, it said, as concerns grow throughout the country about an increasing lack of affordable housing.

China's property developers often lure buyers via several tactics, including touting only the lowest priced unit in residential projects.

Other typical practices include deliberately marking up prices and offering subsequent "discounts" to create the impression buyers are getting a good deal. Some developers also hype up prices by withholding some units to create the impression that newly opened buildings are selling fast and should be snapped up quickly.

China has introduced a number of measures to cool the market since late 2009, including bans on second-home buying in some cities and trial property taxes in Shanghai and the southwestern megacity of Chongqing.

Premier Wen Jiabao told the country's top legislature earlier this month that the government would ramp up a campaign to build affordable housing amid growing public concern over rising prices.

"Morality should flow in the blood of property developers," Wen told Web users in an online media event ahead of the annual session.

The regulation requires home sellers to make public the sale prices of their properties on the market and the number of apartments available for sale within a certain time frame. It did not specify the time frame, however.

The rules apply to property developers that sell completed apartments and those that have obtained approval to conduct pre-sales as well as real estate agents who deal with second-hand apartments.

The rules state: "Price information in property sellers' advertisements must be real, accurate and elaborate." They also say that sellers must disclose information, including parking details and interior decorations.

Under the regulation, home sellers are also required to state charges before the property transaction, such as commission and property management fees.

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