Lee, a home-buyer of "The Icon" who declines to give his first name, displays sales brochures of the residential project, complaining the decoration of his flat is not complete. Provided to China Daily

"Old land lease" flats to be brought into scope of pending legislation

A legislative steering committee is preparing to regulate first-hand residential property sales through legislation.

The committee agreed Monday that a demand on property sellers to provide key information about their properties in sales brochures should be ensconced in law.

This follows a complaint lodged last week by a purchaser that the HK$10 million flat she purchased at "The Icon" had no kitchen nor partitions. Buyers were given promotional leaflets rather than official sales brochures prior to purchasing the flats.

The Icon, developed by Winfoong International, is a 17-story residential project, with 68 flats of 690 to 781 square feet in the Mid-levels.

Since the scandal broke out, there have been at least five complaints reported, according to the Civic Party.

Democratic Party lawmaker Lee Wing-tat said the project's sole estate agent, Centaline Property Agency, should be held responsible for the sale of a flat which its owner described as a "rubbish dump".

"'The Icon' properties are sold under the old leasing conditions and did not need consent from the Lands Department. Given that the sales were conducted through an estate agent, the agency has a duty to verify any information released by the developer or by its own company to ensure consumers will not be misled," Lee said.

Those built on sites with "old land leases", usually issued before the 1960s, do not need the approval from the Lands Department for the pre-sale of incomplete flats.

This contrasts with those coming under the consent scheme, under which applications by developers to sell flats in uncompleted projects are pre-approved.

Lawrence Poon, Hong Kong Institute of Surveyors' housing policy panel chairman, pointed out that the consent scheme was set to stop unfinished projects. Now buyers are more concerned about receiving correct and clear information in sales brochures.

"Until the legislation is in effect, buyers are advised to obtain sales brochures of non-consent scheme properties before purchasing. This will create a market pressure on developers," Poon said.

Chairman of the institute's building surveying division Vincent Ho suggested purchasers to bring along the sales and purchase agreement and Buildings Department's record plan when they check their properties.

Purchasers should also check if the materials and equipments were consistent with those listed in the sales and purchase agreement, Ho said.

A spokesman for the Transport and Housing Bureau said the steering committee will complete its work by October with a view to submitting a report to the Secretary for Transport and Housing.

The committee at its second meeting on Monday studied recommendations put forth by the Subcommittee on Property Information and Show Flats concerning requirements on sales brochures.

Members generally agreed that the existing requirement for developers of first-hand residential properties to provide sales brochures containing key information about the properties to prospective purchasers had been effective.

It has been recommended that the requirement be incorporated into the proposed legislation.

China Daily

(HK Edition 01/18/2011 page1)