HK property agents were warned they face stiff punishment if they use their own money to pay developers in the hope of being allotted a chance to buy homes at popular projects

January 26, 2014 Leave a comment

Agents warned on paying for shot at homes
Friday, January 24, 2014
Property agents were warned yesterday they face stiff punishment if they use their own money to pay developers in the hope of being allotted a chance to buy homes at popular projects.

Fines of up to HK$300,000 and licenses suspended or revoked were cited by Vivien Chan, chairwoman of the watchdog Estate Agents Authority.

“The authority is highly concerned about agents offering financing for homebuyers,” she said, noting there are clear guidelines that ban such action.

Agents are said to be drawn into such dealings when developers announce oversubscription figures at projects, hoping to boost sales.

Potential buyers have to register and provide cashiers’ cheques to a developer, which is how developers can gauge responses to a project.

Chan said the worry about this becoming a problem means more undercover checkers are being sent to watch agents, though only three violations of the money rule are suspected at this time.

The warnings on payments came as the authority revealed it had received a total of 494 complaints last year, with 44 of them from the primary market.

But that compared with 547 received in 2012.

It is also a fact that the number of agent licenses has been falling – it lately stood at 35,900 – since April last year.

The trend has reflected a lackluster market for homes, indicated clearly yesterday when a 1,600-square-foot unit at Harbourfront Landmark in Hung Hom sold for HK$32 million after the asking price had been reduced by HK$3 million.

And a survey by online property platform GoHome, which had 2,575 respondents, showed around one-third of local people interested in buying a home in the first half this year are being tempted by developers’ discounts and rebates.

Still, 86 percent of respondents also said that homes were still too expensive, while 38 percent believed prices will fall.

It was also noted that more than half of the respondents claimed they would consider buying property in Singapore, Malaysia or Thailand.

 

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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