Some Hongkongers say they have had enough of all the misrepresentation they encounter when they try to buy a new flat. The true size of their so-called 700-square-foot flat may actually be only 490 square feet, a shrinkage of 30 per cent, because much of the development's common areas were included in the apartment size. They may also think they are buying on the lucky 88th floor of a building, only to find out they have been drawn in by a marketing gimmick and will actually be on the 46th floor. And there's more. The advertised neighbourhood might be Kowloon Peak but in reality the property is in Ngau Chi Wan. That 'unobstructed' view of the harbour in the brochure? The booklet might not mention that it will be blocked by a new development in a year. Other developments may tout their fine location, but fail to mention that they sit opposite a landfill site. Tired of the liberties being taken by developers to make sales, some in the industry propose radical change. 'Given the magnitude of property transactions and the impact on Hong Kong's economy, the property market should be regulated by an independent body that has some teeth,' said Leland Sun, the chairman of financial services company Pan Asian Mortgage, which specialises in mortgage origination and capital market financing. 'The Real Estate Developers Association is not independent and the Consumer Council has no teeth.' This new regulator would iron out issues such as the definition of gross floor area, unscrupulous marketing strategies and the source of funds behind the supposed 'record high' prices set at some developments. As the Lehman Brothers Holdings minibond case demonstrated - and the need for greater financial regulation globally shows - there would probably be enough public support to create a property market regulator in Hong Kong, said Sun. Pang Shui-kee, the managing director of SK Pang Surveyors, backs Sun's view, saying his proposal is worth considering. 'REDA is turning a blind eye to a host of unethical practices of developers and they are not lifting a finger to address these issues unless there are loud complaints from the public,' he said. Government inaction was adding to the problem, he said. 'Unless the government comes out [to regulate], it will be difficult to force these big corporations to have a better sense of corporate responsibility,' Pang said. 'If everyone tolerates what they're doing, the level of their ethical standards will not be upgraded on their own initiative. 'REDA is a private club which represents the interests of some of the richest men in Hong Kong and their members control the local property market.' This year 75 per cent of Hong Kong's new housing, according to Centaline Property Agency, was supplied by the four largest developers: Cheung Kong (Holdings), Sun Hung Kai Properties, Sino Land and Henderson Land Development. Homebuyers this year spent about HK$109 billion - equivalent to the development cost of five Hong Kong Disneyland theme parks. With so few players, they lack alternatives and must accept what is on offer. Observers doubted whether any of the big developers had been penalised by the association for questionable practice, adding that if such action had been taken the information had not been released to the public. The government has made several efforts to safeguard consumer interests in the purchase of flats. On November 20, Chief Executive Donald Tsang Yam-kuen ordered developers to better regulate themselves. He spoke after reports in the South China Morning Post revealed that Henderson Land had skipped 48 floor numbers at its 39 Conduit Road residential block so it could market the top two floors of the project as the 68th and 88th floors. In following Tsang's directives, REDA immediately drew up several new guidelines. From December 1, developers must state clearly the price per square foot of saleable area (excluding common area) on price lists. Transaction records of individual flats, including price and purchase date, will also have to be made public within five working days after the sale is confirmed, instead of the current period of a month. Sales brochures should also state clearly the floor numbering system and show it in a more prominent position. It was the second set of guidelines drawn up by the association in less than two months. On October 7, it asked member developers to specify and show in their sales brochures 34 different types of facilities that are unpopular with residents. These include landfill sites, crematoriums, mortuaries, slaughterhouses, bus depots, ventilation shafts, petrol and LPG filling stations. However, the guidelines were not legally binding on member companies and Tsang's move did little to curtail further marketing ploys by developers. Two weeks after his call, it was revealed by the Post that the four key players had used glass walls and smaller-sized furniture in their show flats to make them appear bigger than they actually were. 'It is a question of social responsibility,' said Pang. 'What they are doing is not breaching the law but it may not be ethical. REDA will issue guidelines whenever their practices are under fire. It is a kind of public relations bid to address public anger.' A spokesman for REDA said it constantly reviews its guidelines if the issue draws public concern. However, there is little REDA can do if some of its members refuse to follow the rules, Pang said. But Sun Hung Kai Real Estate Agency senior sales and marketing manager Andy Chan contested that view. 'We always follow the rules of REDA and see no problem at all,' he said. The agency is the property marketing arm of Sun Hung Kai Properties, which widely advertised its residential project, Aria, as being located at the prestigious address of Kowloon Peak, an area sought out by homebuyers. In reality, the project is at 51 Fung Shing Street, Ngau Chi Wan - an area dominated by mass housing estates. Others have suggested some alternatives to setting up an independent regulatory body. 'A three-dimensional model of the district with all existing and planned developments within a radius of, say, 500 metres would be useful to show the neighbourhood of the new projects,' said Nicholas Brooke, the chairman of Professional Property Services. At the same time, he said a plan of each typical unit with the internal area measured and certified by an authorised person could be a solution to the constant debate of gross floor area. However, David Webb, the shareholder rights activist and editor of Webb-site.com, said setting up a statutory body would be interventionist in the free market. 'The government should take a statutory cooling-off period of, say, two weeks for sales of new homes. Then if people change their mind after a high-pressure sales pitch they can get their money back,' he said. A cooling-off period is being considered by the Securities and Futures Commission for structured financial products. 'Apartments often involve even more money. Of course, some people would use the cooling-off period as a free 'put option' to return a flat if the market goes down, but that is a small risk which developers should take,' said Webb.