Government launches public consultation on proposed legislation to regulate the sale of first-hand residential properties (with video)

Government launches public consultation on proposed legislation to regulate the sale of first-hand residential properties (with video)
***********************************************************

     The Government today (November 29) released a consultation document to seek the views of members of the public and stakeholders for a period of two months on the proposed legislation to regulate the sale of first-hand residential properties.

     The consultation document, entitled "Public Consultation on the Proposed Legislation to Regulate the Sale of First-hand Residential Properties", was released by the Secretary for Transport and Housing, Ms Eva Cheng, at a press conference. Its key features include:

1. Covering the sale of all first-hand residential properties;
2. Setting out comprehensive, detailed and specific requirements for sales brochures and price lists. Property developers will have to make public the sales brochures at least seven days and the price lists at least three days before the commencement of sale;
3. Adopting a standardised definition for "saleable area" and using it for quoting unit prices of flats;
4. Requiring developers to compile a single register into which information on preliminary agreements for sale and purchase and agreements for sale and purchase have to be entered within 24 hours and one working day respectively.
5. Prohibiting misrepresentation and the dissemination of false or misleading information. A person who commits an offence will face a maximum penalty of a $5 million fine and seven years' imprisonment.

     Ms Cheng said, "The proposed legislation aims to enhance the transparency of the sales arrangements of first-hand residential properties and to strike a balance between enhancing protection for consumers and allowing flexibility of property developers to make commercial decisions based on the market situation. As the proposed use of legislative measures for regulation is a new arrangement and there is widespread interest in the community on the subject matter, the Government has decided to publish the draft provisions of the proposed legislation for public consultation before formally introducing the bill into the Legislative Council.

     "The Chief Executive in his 2010-11 Policy Address announced the setting up of a steering committee to study the regulation of the sale of first-hand residential properties by legislation. The committee completed its task in October this year. After thorough consideration of the recommendations made by the committee, the Transport and Housing Bureau (THB) has prepared proposed legislation - the Residential Properties (First-hand Sales) Bill - to regulate the sale of first-hand residential properties."

     In the past few years, the Government has introduced various measures to further enhance the transparency of the sale of first-hand uncompleted residential properties. However, the present regulatory framework is administrative in nature. It does not cover "non-consent scheme" projects nor apply to those developers who are not members of the Real Estate Developers Association of Hong Kong or first-hand completed residential developments.

     Ms Cheng said, "The Government agreed that the current measures are not sufficient and there is a general consensus on a need to use legislation to regulate the sale to enhance protection for the buyers.

     "We will take the views collected during the consultation period as reference to help us polish the proposed legislation. We will try our best to submit the draft bill to the Legislative Council in the first quarter next year. We hope to get the support of Members of the Legislative Council so that the legislation can be enacted quickly. We wish to encourage all organisations and institutions concerned as well as members of the public to express their views.

     "An enforcement authority will be set up under the THB to enforce the legislation and to monitor compliance by various concerned parties," she said.

     The consultation period commenced today and will last until January 28, 2012. The proposed legislation and the consultation document can be obtained at the District Offices, or downloaded from the THB website (www.thb.gov.hk). Members of the public and stakeholders may send their views to the THB via post (address: 2/F, Block 1, Housing Authority Headquarters, 33 Fat Kwong Street, Ho Man Tin, Kowloon, Hong Kong), facsimile (fax number: 2761 6100), e-mail (e-mail address: firsthandsale@thb.gov.hk) and e-forum (forum2011.thb.gov.hk) or at the public forums.

Ends/Tuesday, November 29, 2011
Issued at HKT 14:41

NNNN