Money

Crackdown shuts door on low-cost apartment cheats

By Meng Jing (China Daily)
Updated: 2010-05-31 07:52

As many as 1,371 families have been caught concealing their savings and properties during the process of applying for low-cost apartments over the past year, according to the Beijing municipal commission of housing and urban-rural development.

Nearly 100 out of those families have already signed contracts with real estate developers. Their purchase contracts have been voided, the commission said in a press release.

Housing authorities have begun the largest-scale qualification examination ever undertaken of all the 179,400 households in low-cost apartments in Beijing, aiming to crack down on fraud.

The examination, which is scheduled to end in late December, reviews the qualifications of those who have purchased or rented low-cost apartments, as well as those who have submitted applications but are still on the waiting list.

Anyone found to fake their qualifications will be put on a blacklist and will not be able to apply for a low-cost apartment in the following five years.

Violators who have purchased and moved into low-cost apartments must return the apartments once they are caught.

Workplaces which provide false certificates will also be subject to punishment, according to Beijing News.

The municipal commission of housing and urban-rural development is working with the municipal civil affairs bureau, police and tax authorities to obtain the applicants' information.

Low-cost apartments are a government project designed to help solve the housing problems of low-income urban residents.

All applicants should be adults and Beijing hukou, or household registration, holders. Their salaries, savings and current living conditions should be within certain government-set guidelines.

Zhang Yue, a market analyst from Homelink Real Estate, said that an ordinary low-cost apartment is priced at 7,000 to 8,000 yuan per sq m while a second-hand apartment fetches 17,000 to 18,000 yuan per sq m.

Few people resell their low-cost apartments for profit because they must wait five years to get the right to sell it, Zhang said.

"People seldom buy a 5-year-old secondhand apartment in this market. So most people who fake their qualifications to get low-cost apartments usually earn money by renting them or they simply don't want to pay or cannot afford the free-market price," Zhang told METRO.

According to Homelink officials, 500,000 to 600,000 households seek new apartments in Beijing every year. Fewer than 200,000 apartments are expected to be purchased in 2010 because of rising home prices.