(China Daily)
Updated: 2008-01-21 07:32

The authorities should improve the management of real estate agencies, says an article in Worker's Daily. The following is an excerpt:

Nanfang Daily reported that Chuanghui, a large real estate agency, had closed some of its outlets in seven major cities in the Pearl River Delta. Only a third of its outlets in Shenzhen, its home base, remain open.

The report said groups of people - buyers and sellers of houses, suppliers and Chuanghui's own employees - had gathered at the company's regional headquarters in cities around the country. Buyers and sellers want deposits and down payments returned. Suppliers want debts repaid. Employees want unpaid wages. Judging from the company's health, it looks unlikely that many of these people will receive the kind of satisfaction they are seeking.

Real estate agencies have become a source of problems alongside the fast development of the property market. In recent years, the sector's robust growth has unleashed a torrent of new real estate agencies. It took Chuanghui just a few years to open 1,600 outlets, and the company was determined to expand to 3,000.

The lack of oversight by the government has allowed such problems to flourish. Some government bodies expend so much energy propelling the real estate market and land sales that they have little left to regulate agencies. Local governments rarely refuse to let agencies open new outlets, primarily because they can charge administrative fees.

As the country's real estate market cools off, agencies like Chuanghui will continue to create risks for the public. The authorities should embrace their monitoring responsibilities by undertaking a comprehensive study of how these businesses are managed.

(China Daily 01/21/2008 page4)