The housing authority in Bao’an has suspended the registration of sales of pre-owned apartments at a housing estate after homeowners there were suspected of conspiring to hike prices.
The Bao’an District Housing and Construction Bureau issued a circular Tuesday evening, saying some homeowners at COFCO Fenghuangli Garden in Fuyong Subdistrict had been collectively setting minimum prices for their apartments. Therefore, they were suspected of conspiring to raise prices, the bureau said.
A notice from the leader of the housing estate’s WeChat group says that any asking price should not be lower than 56,000-65,000 yuan (US$7,993-9,270) per square meter and there is no maximum. The notice was widely circulated in Shenzhen on Dec. 13. Some media reports said WeChat groups of homeowners of at least 10 other housing estates followed suit by setting minimum prices.
On Dec. 15, an investigative report by China Securities Journal said the move had pushed up the prices of pre-owned apartments in several housing estates in Futian, Longgang and Longhua. Some even witnessed a surge of 2 million yuan per apartment within two months of the homeowners collectively raising their asking prices, the report said.
The bureau said it will summon some of the people who posted messages about raising prices on the Fenghuangli WeChat group for a discussion and the registration of ownership transfers would be suspended.
The bureau will also launch an investigation into the alleged conspiracy to hike prices. Those who are found to have violated regulations will be blacklisted and have limits imposed on home transactions and public housing benefits. Those who are suspected of breaking the law will be handed over to the police or other competent departments for further investigation.
The pre-owned housing prices in Shenzhen rose 1.4 percent in November from the previous month and 6.4 percent year on year, according to official statistics.
Yan Yue, research supervisor at the Think Tank Center of Yiju Research Institute, told the Southern Metropolis Daily that the continued increase of pre-owned housing prices in Shenzhen has been a result of homeowners “controlling the prices,” in addition to optimism over the prospects of the Greater Bay Area and Shenzhen’s new role of building a pilot demonstration area.
Liu Xu, a research fellow with the IPR and Competition Law Research Center under Tongji University, told the Daily that homeowners who collectively control prices may be subject to penalties under the Anti-monopoly Law.
Homeowners who violate the law will face a fine of between 1 and 10 percent of the price, Liu warned.