U.S. media: Credit crisis behind the tide of refunding the real estate

An article recently published on the Voice of America Chinese network discusses about the China’s credit crisis behind the tide of refunding the real estate. 

An article recently published on the Voice of America Chinese network discusses about the China’s credit crisis behind the tide of refunding the realestate.

As thehousing price decreases greatly, the owners suffer great loss. The owners complained that their investment in the realestate has so severely diminished. Some would-be owners are dissatisfied thatbefore the house has been handed in them, the price has decreased. They believeit unfair for them to compensate for the buddle in the real estate industry asit is the developers who have made great sum of profits in the real marketpreviously.

Then do the owners have any right to maintain? Dean of ChinaDevelopment Institute of Tourism and Real Estate Research Center, Song Ding toldthe official media that the purchase contract must be adhered to, but at thesame time the buyers’ innate weak bargaining position must be paid attentionto. Meanwhile, developers shoulder the responsibility of pushing up houseprices. He believes that the reason for the fact that in China’s realestate market, whenever the price decreases, the refunding increases is that thereare many frauds in the aspect of real estate sales and n regulatory loopholes.

Yan liang, real estate commentator in Jiangsu Province,says that these loopholes are not merely unveiled by the sudden decrease inprice, but also in the false promises in housing sales and fraudulentpropagation. The victims are ordinary people while the Government’s regulatoryoversight of real estate developers has provided to the action of fraud with moreconvenience. He said: “This reflects an old problem that it is verydifficult for some developers to fulfill the commitment made in publicity. Thissituation often occurs in the real estate industry, I think there are tworeasons, one is the owners have few ways to maintain their rights. In fact, theowner’ confusion can reflect the regulatory gaps. The other is that for thedevelopers, the cost of violating the law is too low. In other words, even ifthe owners accuse the developers of false propaganda and not fulfilling the commitmentand even if the evidence is conclusive, according to the present. “Consumer Protection Law “, it is difficult for developers to receive amemorable punishment.” Some critics say that this refunding tide actuallyshows a lot of behind inequality and it is an exposure of the long-term creditcrisis in the Chinese real estate market.

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