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Study on the Sales of First-hand Residential Properties
- Pressure to make quick sales, a limited number of units for selection, and units released in small batches with price increases, these are some of the endemic problems that have characterized the sales of first-hand residential properties in Hong Kong. One and a half years after the Residential Properties (First-hand Sales) Ordinance (the Ordinance) came into place in April 2013, the Consumer Council (the Council) conducted survey, focus group meetings, field visits and research to ascertain whether the new law has put an end to these problematic issues.
- The Ordinance aims to ensure information transparency and that adequate information is provided to prospective purchasers of first-hand residential properties for a rational and informed choice. The intention of the law is to promote the accuracy of market information and impose a discipline on the behavior of persons involved in selling the properties; while still ensuring that there is not an overregulation of sales practices that might stifle legitimate business.
- Legislation is a good start in ensuring a fair marketplace. However, the findings of this study showed, it is not yet a panacea for resolving the range of problems that can arise, and which have been identified by the Council.
- The study is comprised of two parts. Part one is consumer research comprising a survey of 602 respondents from across Hong Kong, during April and May 2014 and three focus group meetings in late May 2014. Part two of the study comprised field visits carried out by the Council, during June and July 2014, involving 17 residential development projects of different scales of development by different property developers. In addition to field visits, compliance checks were conducted on these 17 developments. The Council’s study commenced in April 2014 and was completed in September 2014.
- In this report, the results of consumer survey and focus group meetings conducted by the Council indicate how consumers assess this Ordinance and what they want to improve. Field visits on selected residential property developments indicate how in practice consumers are being treated during the sales process. Compliance checks undertaken by the Council staff on sales materials distributed at sales offices, documents available on the developments’ websites and advertisements indicate how the trade has been performing under the relevant obligations imposed under the Ordinance. The Council had also made an attempt to identify any market practices not being regulated could affect consumer interests.