After recovering funds or gathering information about property purchases in the initial stages, several buyers said police visited their homes, sometimes in the middle of the night.
“I feel like I’ve been cheated the whole time,” one buyer said in Mandarin. Translated by CNBC.
“My only request is to get the house back and get my money back,” the buyer said. “Even if I could get the house, I would still feel bad.”
Some buyers said they bought the apartments as a place for their parents to retire or for their children to attend nearby schools. While waiting for eight years to move in, one buyer said one of his parents died while waiting for a new home, and another said his children grew up and went to another school instead. He said he found it.
The developer in the case, Zhuoda Yidu, asked homebuyers late last month to approve a dispute resolution, a copy of which was seen by CNBC.
The apartments could be completed in 2025 or 2026 if the buyer agrees to pay the outstanding balance of the property purchase within the next few weeks, as well as other fees determined by the developer, the documents said.
The proposal offers no alternatives and says properties must be valued at more than their pre-market downturn value, which is roughly double the current level compared to listed brokerage prices. Not to mention the eight years of wear and tear and potential disruption to your family’s life plans.
One buyer said of the home he purchased in 2016, “My father gave me the down payment.” “I can’t say it’s not finished. During the coronavirus pandemic, I told them there would be delays, but now that the coronavirus has passed, there will be delays. I won’t make excuses.”
In addition to paying the full price for the apartment, the buyer continues to pay about 2,800 yuan a month for the mortgage on a second apartment for a relative in the same complex.
One of the people said the situation is fueling feelings among buyers that no matter how much money they spend, they won’t be able to afford the home. The person noted that in a group chat of about 500 fellow buyers on social media, about 90% rejected the developer’s offer.
CNBC made multiple calls and emails to the company and its representatives, but Zhuoda Yidu could not be reached for comment. A lawyer in charge of Zhuoda Yidu’s bankruptcy and liquidation case referred CNBC to Tianjin Wuqing District People’s Court for comment. The court did not respond to CNBC.
Mr Wang said it was the first time he had heard of homebuyers having to pay more to get a finished apartment.
He said that before the coronavirus pandemic, there were sporadic instances of delivery delays, especially in cities such as Tianjin, which saw a surge in real estate development in 2014 and 2015. At the time, local governments and developers said they would typically find a solution quickly. Because it costs a lot of money for the average family.
Interest in Tianjin and other areas around Beijing had surged before the pandemic, as working people in China’s capital sought more affordable housing options at a time when prices were near their peak.
Beyond China’s recent real estate problems, the root of homebuyer dilemmas lies in the household registration system known as hukou. The family registration system stipulates which public schools children can attend. Cities such as Tianjin are also using hukou policies to attract new residents.
However, Wang noted that delivery delays have increased since the coronavirus outbreak as developers have struggled to continue operations and “systemic issues” have arisen.
At a meeting in late April, China’s top leadership said it would continue to work to ensure the delivery of homes and protect the interests of homebuyers.
China’s Ministry of Housing and Urban and Rural Development and the local department of Tianjin’s Wuqing District did not immediately respond to CNBC’s inquiries regarding this matter.
Development company Zhuoda is far from one of China’s largest companies. Some homebuyers who spoke to CNBC said they discovered after making their down payments that the property in question was not necessarily a certified project.
In a sign that the project had problems from the beginning, the state-run newspaper Tianjin Daily reported in March 2017 that the same Xiyuyuan project that Zhuoda Yidu Investment had built in Tianjin’s Wuqing district was raising money to It was reported to be a violation of real estate transaction regulations. Purchasing from a purchaser without obtaining a commercial home sales permit. Local authorities imposed penalties and ordered remediation, according to the report. Zhuoda Yidu had received construction permits for parts of the project in 2016, but did not receive permits to sell commercial housing until August 2018, according to records accessed through business database Qichacha.
One homebuyer confirmed to CNBC that the buyer was able to obtain a certificate of purchase after the incident reported by Tianjin Daily.
Buyers of Tianjin apartments interviewed for this article said efforts to get the project placed on the central government’s unfinished housing list, which usually guarantees loans until completion, have failed. He said he knew about it, but it was unclear whether it was because of the project. Certified status. The recently proposed dispute resolution proposal was seen by some as a response to changes in central policy, as it is a pathway to completing construction rather than leaving the project suspended.
The real estate sector’s woes are also weighing on the finances of local governments, which once generated significant income from selling land to developers.
Among China’s high-income cities, Tianjin has one of the highest levels of debt relative to GDP, according to S&P Global Ratings.
For many households, real estate makes up the bulk of their wealth, much of it the result of pooling savings between grandparents and other relatives.
One homebuyer spent 190,000 yuan for a 90 square meter two-bedroom apartment in an unfinished Tianjin apartment complex for 700,000 yuan.
This equates to several years worth of savings. In 2023, the average per capita disposable income of residents in Beijing will be 88,650 yuan, and in Tianjin 51,271 yuan, reflecting a significant decline in the cost of living.
“We don’t have that much money,” the buyer told CNBC. “If I had enough money, I would buy it in Beijing.”
