Tighter controls urged on agents selling property overseas

PUBLISHED : Friday, 16 October, 2009, 12:00am
UPDATED : Friday, 16 October, 2009, 12:00am

The consumer watchdog yesterday demanded that the government tighten its control over agencies selling properties outside Hong Kong.

Victims of a property investment scheme told the Consumer Council they waited for more than four years but had made nothing from uncompleted villas in Thailand.

A Hong Kong estate agency had told them the villas would take about a year to build and they would be completed between July 2004 and early 2005. Neither the agency's name nor the location of the villas has been disclosed. If they agreed to rent the villas to visitors, the buyers were 'guaranteed' a fixed net return of 12 per cent of the property price each year for eight years. They could also live in the villas for a month every year.

However, the villas remain uncompleted. Bad weather and land-title problems were to blame, the developer said. Each villa cost between US$130,000 and US$200,000, and the complainants had made down payments or installments of between US$63,000 and US$170,000.

In the first nine months of this year, the council has received 12 complaints about the Thai properties. All the complainants bought the villas through the same Hong Kong agent.

The council also received a complaint this year about a mainland property from a woman who placed a deposit of HK$23,000 on a flat. She was assured by an agent that an area in front of the building would be developed into a park. But after making the deposit, the agent told her a multistorey building would be built instead of a park, blocking her view. 'Agents who sell, exclusively, overseas properties - not local properties - are exempted from getting an estate agent's licence,' the chairman of the council's publicity and community relations committee, Ambrose Ho, said.

He demanded that the government review the ordinance and consider cancelling the exemption. 'It's no longer a small number of Hongkongers who buy properties outside the city,' he said.

Anyone deceiving buyers of overseas properties in transactions was liable to prosecution under the Theft Ordinance, a Transport and Housing Bureau spokesman said. Buyers who suffer losses owing to misrepresentation could claim damages through civil litigation, he added. The bureau had to be very careful when considering whether estate agency work relating to properties outside the city should be brought under the Estate Agents Ordinance.

The Estate Agents Authority said that as different countries had different regulatory regimes, the legal issues involved in regulating non-Hong Kong properties were wide-ranging and complicated.