The Consumer Council has identified a number of major issues of concern arising out of the Swallow Garden incident.

The Consumer Council has identified a number of major issues of concern arising out of the Swallow Garden incident.

First, it demonstrates that the level of consumer protection for property under the New Territories Small House Policy ("Small House Scheme") lags behind that for developments under the "Consent" and "Non-Consent" Schemes.

Second, it brings into question such issues as redress mechanism and adequacy of protection.

Property under the "Small House Scheme" is generally exempted from basic building safety regulatory requirements that are applicable under the "Consent" as well as "Non-consent" Schemes, for example, those relating to the approval of building plans, application for commencement of building works, issuance of occupation permit, appointments of authorized persons and registered contractors to supervise the works.

Currently all developments for sale on the open market - "Small House" units again exempted - must provide accurate prescribed information in the sales brochure.

Such essential requirements as well as measures to protect consumers against non-completion of the properties are, however, lacking in "Small House" developments.

The exemption is unique in the New Territories due to historical reasons. However, an increasing number of "Small House" developments are neither developed nor inhabited by the indigenous villagers in the New Territories these days. They are often put on public sales in the property market.

The Consumer Council is concerned that consumers may have great difficulty in seeking redress from the person or persons responsible for the structural safety of the properties in question as the Swallow Garden incident demonstrates.

This is because, in many instances, "Small House" properties are developed by one-project companies which are wound up soon after the completion of sales of the developments.

Although this may also apply to most other building developments in Hong Kong, the "Small House" units are developed on a much smaller scale and hence these contractors or developers are often not under any parent company with a public goodwill at stake should consumer complaints be brought against them.

The liability of the various parties involved in a property development should be clearly delineated to enable the purchasers to channel their complaints for redress. These are issues calling for an urgent solution across the board and in particular, for the "Small House" units, in order to protect purchasers' interest.

Moreover, consumers are unable to discern (until they consult their lawyers after signing the preliminary sales and purchase agreement) if the properties they intend to purchase belong to a "Small House", "Non-Consent" or "Consent" scheme development and hence the varying degrees of protection afforded them as well as the encumbrances attached to their legal title (e.g. restrictions of alienation insofar as "Small House" units are concerned). Some estate agents and law firms would not handle the transactions of "Small House Scheme" property.

As a matter of principle, the Consumer Council is of the view that a consistent policy and the same basic regulatory safeguards relating to property developments and transactions should apply to all development schemes across the property market in the interest of purchasers, and public safety.

Complaint Statistics on purchase of properties

Complaints on village houses

Complaints on village houses

The statistics on village houses are included in the overall statistics.