CITY authorities have drafted a new rule to ban the resale of low-cost government homes in response to rampant fraud discovered in housing applications, Chinese-language media reported yesterday.
The rule was drafted by the city s urban planning and land resources commission shorty after the annual session of the municipal people s congress. A number of deputies at the congress called for the cancellation of low-cost apartments following the exposure of many false financial statements and other documents in applications for government-subsidized housing.
Under the new rule, which is yet to be approved by the city government, low-cost homes which usually sell for only one third of the market prices to eligible residents cannot be resold in the real estate market.
It will effectively curb fraud in applications for the low-cost housing because those who falsely obtained the homes can t sell them for profit, said Song Ding, director of the city s tourism and real estate research center.
Property owners can make a handsome profit by selling low-cost government apartments at market prices which have skyrocketed in the past few years.
It was worth the risk because even if you are caught cheating in the application, you ll be fined only 5,000 yuan (US$758) and banned from applying for three years, said a taxi driver, identified only as Cai.
Early this month, 20 applicants who were found to have falsified financial details were each fined 5,000 yuan and deprived of the right to apply for government housing for three years.
This light punishment resulted in rampant fraud. More recently, many applicants on the final eligibility list published on New Year s Eve were discovered to have lied about their financial situation. A wealthy businessman was also on the eligibility list.
The rule states that the low-cost housing can be sold back to the city government at one-third of the market price for reallocation to other eligible families.
(SD News)
