Three real estate developers in Shanghai are being investigated for fraud, the municipal government has announced.
An outcry has engulfed local media and citizenry after the Tomson Haijing Garden (Shanghai Pudong New Area) Co. Ltd valued its brand new Tomson Riviera apartments for sale at 110,000 to 120,000 yuan (US$14,285 to 15,584) per square meter.
Although the apartments went on the market in October 2005, the company's website shows that only three have been bought so far with deposits having been secured from three other customers.
The company has been accused of holding off on selling their apartments to profit from soaring real estate prices in the city. Such actions have now been curtailed since the Shanghai municipal housing, land and resources administration suspended the project.
The bureau is also examining the business track records of two other companies - Shanghai Jiahe Real Estate Co. Ltd and Shanghai King Wai Holdings Co. Ltd – which have also seen their projects suspended.
Shanghai Jiahe is accused of buying 204 apartments out of its own 276 apartments in order to hoard property while the price continues to rise while Shanghai King Wai reneged on 300 contracts with potential buyers in an attempt to ward off sales.
Amidst rising house prices in major Chinese cities, relevant authorities have vowed to end unfair practices that could drive prices even further.
(Xinhua News Agency June 6, 2007)
