What can you accomplish in 180 seconds?
Make a cup of coffee? Use the washroom? Or have a quick snog with your honey?
Wait, you can buy a flat in Hong Kong.
Thanks to the Consumer Council, we now know that prospective homebuyers in a sales queue may be given just three minutes when it is their turn to make a purchase decision.
All told, buying property in this city is an unfair game: the home advantage is tipped toward home sellers, not buyers.
Buyers are paying big money for a small flat. But they won’t complain as long as the property market keeps going up.
Luckily someone has now come out to take the Sales of First-Hand Residential Properties Authority to task over its ineffectual regulatory regime.
A year and a half after it was set up, the self-regulating authority in one of the most lucrative sectors in Hong Kong has carried out zero prosecutions for misleading sales tactics.
The Consumer Council found the Residential Properties (First-hand Sales) Ordinance failed to sufficiently deter practices detrimental to homebuyers’ interests.
Professor Wong Yuk-shan, who chairs the consumer watchdog, said: “Much to our disappointment, such deep-rooted practices as aggressive tactics to make quick on-site sales, units released in small batches for possible market speculation, confusing exaggerated claims and information that plagued the market in the past have somehow persisted.”
One case in which a field worker for the council took part in the balloting for a new flat as a “mystery shopper” illustrates the intense pressure that prospective homebuyers are under to make a decision.
The whole process, from being shown the units available for sale to deciding on a purchase, typically took only a few minutes.
In a 153-page report, “Study on the sales of first-hand residential properties” (http://bit.ly/1xruk6P), the council concluded: “It is a basic right of consumers to be informed adequately and accurately.
“Prospective purchasers should have the time to collect and verify information from the estate agents before making purchases … The Council wonders under such aggressive sales tactics how many homebuyers are rushed into making abrupt and ill-informed decisions as a result.”
Last year, Park Metropolitan, a joint project of the Urban Renewal Authority and Sino Land, was reported to have specified in the sales document that potential buyers had to make a purchase decision within three minutes.
Moreover, the cooling off period for sober second thought is only five days, much shorter than in Singapore (21 days) and Vancouver (7 days).
Melbourne probably has the world’s shortest cooling off period, three days, but only A$100 (HK$668) is required as a down payment, compared with 5 percent of the flat’s price in Hong Kong, where the deposit in many cases will amount to HK$500,000 or more.
The council suggested reducing the down payment to between 1 percent and 3 percent.
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