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Developers using tricks to sell units

By Li Xinran | April 7, 2009, Tuesday | Print Edition

SOME Beijing developers are reportedly hiring phony buyers, many retirees, to help prop up sales and prices.

An elderly woman from a neighborhood committee in Beijing's Chaoyang District, identified as Zhang, said she was invited by developers to pretend to buy apartments in several new developments on the Fourth Eastern Ring Road, the People's Daily reported yesterday.

Zhang said she and other retirees were paid to pretend to sign contracts to buy apartments. They were paid 50 yuan (US$7) a day plus food and drink, she said.

Developers have also been telling buyers the market is still buoyant.

A buyer surnamed Zhong was informed the condo he wished to purchase was very popular and he needed to bribe the sales manager to get the best ones at the best price.

Zhong, a clerk at a major state-owned enterprise, offered the manager expensive gifts and treatment to get a 1-percent discount.

However, he found similar promises from the manager piled several inches high in the sales office, the report said.

Developers were also telling buyers that housing prices in major cities, such as Beijing and Shanghai, had rebounded and many investors had flooded back into the market.

But the contracts with these "investors" - from Wenzhou, Zhejiang Province, or Shanxi Province - are considered to be suspicious.

In some Shanghai complexes all the sales deals were revoked several days later.

The Yangtze International Trade Center had 93.45 percent of its May sales revoked and 99.41 percent of its June deals stopped.

In reality, the prices of some older projects have dropped heavily.

The prices of apartments in the Yintai Center, the tallest building on Chang'an Avenue, Beijing, have nosedived from a peak of 90,000 yuan per square meter to 60,000 yuan last year and could drop lower, according to the report.

China is expected to have 250 million square meters of empty condos by the end of this year, according to 21st Century Business Herald.

Cao Jianhai from the Chinese Academy of Social Sciences said housing prices could still drop 40 to 50 percent and prices may not bottom out for another two years.

Nation


 

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