Public push for property pre-sale regulation

Saturday, April 12, 2008
Issue 311, Page 1 & 2
Word count: 824
Published in: Macau Daily Times

By Poyi (Natalie) Leung

Opinions collected from the public regarding pre-sales of uncompleted property show the majority want new regulations forcing developers to register units before selling them.

Community organisations and the banking sector also suggested to the government the practice, common in neighbouring regions, of not allowing advance sales of property until the building reached a certain height or topped-out, should be introduced in the SAR.

The sale of unfinished real estate was one of the 15 areas of the notary registration system the Legal Affairs Bureau (DSAJ) is currently working on reforming.

All the proposed changes are covered by the Codes of Civil Affairs Registration, Business Registration, Property Registration and Notary, involving property sales, marriage and birth registrations, divorce, as well as illegal hostels and construction.

The public consultation was carried out between January 26 and March 15 and about 21,800 valid questionnaires were collected.

The survey concluded more than 70 percent of the interviewees favour all of the changes outlined.

Director of DSAJ, Cheong Weng Chon, said during yesterday’s press conference that the government hoped to have the draft bills concerning the final amendments of the four Codes completed in September.

Mr Cheong said unfinished property pre-sales concerned the public the most and received a significant amount of responses.

One of the suggestions proposed by the government in a bid to protect the interest of buyers was that developers must have to complete a temporary “sub-levels” registration of the building at the Real Estate Registry ahead of selling the uncompleted property lawfully.

Some 80 percent or 4,500 interviewees, including residents and real estate, banking and legal associations agreed with the introduction of the restriction.

The General Union of the Inhabitants Associations of Macau (UGAMM) suggested that Macau could look at the examples of Hong Kong or other neighbouring regions where advance sales of uncompleted property cannot be performed until the building has been built to certain levels or its concrete structure is complete.

Feedback received also suggested the implementation of a “bond system” which would see developers deposit a certain amount as security so that construction can continue if developers withdraw from a project unexpectedly.

On the other hand, the real estate sector hoped that the Public Works Bureau, after approving the floor plan, could transfer the property details to the registry for the temporary registration in order to minimise the time of processing.

Apart from giving concession to stamp duty payment after registration, the real estate sector suggested the set up an individual bank account for keeping funds from pre-sales transactions which can then ensure that the lump sum received will be spent on related construction projects.

Meanwhile, the banking industry expressed concern that developers might not support the temporary registration as the property’s book value was likely to be reduced.

Yet they backed up limiting pre-sale transactions if construction has not progressed to a certain stage and adding regulations to prohibit developers from embezzling pre-sales earnings.

Mr Cheong admitted that the law could not fully stop illegal acts, adding that buyers must “purchase wisely” and understand what the potential risks were in making a pre-sales transaction.

Divorce involving children

Although the proposed changes generally received support from more than 70 percent of the interviewees, the move to simplify the procedures of divorce where both parties agreed only gained a positive response from 61 percent or 1,000 people out of the 1,642 questionnaires distributed. The proposal also saw the most diverse opinions of the entire survey, Mr Cheong said.

The opposition, which accounted for 35 percent or 580 interviewees, said if a divorce involved underaged children, it was more appropriate to have the procedures done through the court rather than at the Civil Affairs Registry.

“The judicial institute was able to offer more legal protection to the family and was less likely to give out the perception that ‘divorce can be done conveniently’ and would lead to more ‘preventable divorces’,” said one respondent.

At present, the Civil Affairs Registry has the authority to handle mutually agreed divorces only when the couples do not have children who are underage, or else the case must have to be processed at the Court of First Instance.

The UGAMM was in favour of the current system, although most of the residents agreed that mutual divorces did not necessarily have to be handled at the court as they were not controversial and didn’t require judicial involvement.

As the reform in the areas of civil affairs registration and business registration obtained a relatively larger consensus, Mr Cheong said the proposed changes of the Civil Affairs Registration Code would enter legislative proceedings “hopefully next month”, to be followed by the Business Registration Code and lastly the Property Registration Code and the Notary Code.

He added that the government needed to greatly strengthen promotion works of the existing legal system within Macau’s society as people were generally “not familiar with the law and therefore were unable to seek legal protection when needed”.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: