Real estate agency regulation urgently needed to stabilize overheated housing market

Updated 2017-03-22 10:03:31 Global Times

Anchoring agents

After a new round of home-buying restriction policies were released around the country, authorities began conducting inspections of some real estate agencies to further stabilize the domestic housing market and curb speculative buying. Experts said that measures such as examining online home sales information should be implemented to better regulate real estate agents. Industry insiders said that restrictions should cool China's overheated residential housing market, but they will spur growth in the commercial property market. Given the realities of the current housing market, the home rental market also has great growth potential.

A day after the Beijing municipal government announced new home-purchasing restrictions on Friday, local authorities started inspecting several property projects and real estate agencies, media reports reported on Saturday.

The Beijing Municipal Commission of Housing and Urban-Rural Development on Saturday carried out random inspections at several property projects and agencies and turned up irregularities at some projects and misconduct at some agencies, The Beijing News reported on Saturday.

Inspectors discovered the sales information for several projects developed by Beijing Daoxiangsiji Property Development Co and Beijing Xinyide Property Development Co was incomplete and nonstandard, the report said.

Also, they found false entries on the books at one branch of the Beijing-based property agency 5i5j.com Corp in Haidian district.

The commission will punish the offending agencies with administrative penalties after further investigation, according to the report.

New regulation for real estate agencies is sorely needed because they have played such a large role in driving up domestic home prices in recent years, experts said.

In some cases, real estate agencies have hired people to stand in line in front of housing project offices to create a false impression that properties are in high demand, said Liu Dingding, a Beijing-based independent industry analyst.

“This kind of tactic, which is commonplace, is against the rules,” Liu told the Global Times on Sunday. “The Chinese government is expected to tighten regulations over the industry.”

In Dongguan, South China's Guangdong Province, the local government on March 15 announced new rules for local real estate agencies. It plans to set up a housing agency expert database to clamp down on price rigging and down payment loans, among other problems, according to a report on the news portal sohu.com on Sunday.

Tighter regulations

For the last five months, Beijing authorities have been carrying out inspections at branches of the Lianjia real estate agency, said an employee surnamed Zhang, who works at a Lianjia branch in Chaoyang district. She noted that the company also conducts its own investigations.

“The inspections became stricter after February,” she told the Global Times on Sunday. “For example, Lianjia sometimes inspects some of its branches two or three times a week, aiming to check whether newly opened branches have qualified certificates or housing resources are real.”

Lianjia moved one of its cooperative bank staff out of its Chaoyang branch about five months ago because the government was looking into the branch, said an employee of a State-run bank that works with Lianjia to offer home loans to buyers. The employee refused to be named.

“In 2016, it was reported that -Lianjia was providing down payment loans to its clients, which allegedly encourages speculation,” the bank employee told the Global Times on Monday.

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