Chinese buyers of homes at the Forest City development project in Johor are reportedly stuck between a rock and a hard place.
After being unable to proceed with their purchases due to China’s capital controls, they now have to pay the project’s developer a hefty compensation for backing out from the deals.
After some of the buyers tried to seek refunds for the 10 percent deposit they paid for the units by developer Country Garden PacificView Sdn Bhd (CGPV), they were however told that they had to pay a penalty equivalent to 30 percent of the purchase price for not going ahead with the deal.
Although the clause was indeed in the sales contract, the buyers told Singapore’s TODAYonline that this was not made clear to them at the time of purchase.
“Nobody told me anything about this clause, not even the lawyer who was present when I signed the agreement,” said Vicky Wu, a 42-year-old joint venture employee from Guangdong.
Wu had purchased a 59sqm apartment for about RM693,000 and made the 10 percent down payment on the day she visited the Forest City sales centre in Johor last December.
A member of the newly set up “Quit Forest City and get refunds” WeChat group, Wu said she tried to get a refund from CGPV but was rejected.
“The whole incident is a nightmare that I want to wake up from,” said Wu.
Other members of the 50-strong chat group say they are in the same predicament as Wu.
“The developer rejected outright my request for a refund,” said Gu Wen, a Chongqing native who had bought a 70sqm unit for about RM950,000 as an investment.
Buyers such as Wei Youle from Qingdao, who bought a 84sqm unit for around RM963,000, said that they hope they could resolve the issue with CGPV soon. “I just hope we can get refunds,” said Wei.
Asked to comment on the 30 percent compensation clause, CGPV’s chief strategy officer Yu Runze said the buyers who sought refunds belonged to a small group and were not representative of the majority of its buyers.
“We are in discussions with these concerned buyers and will facilitate the refunds based on the terms and conditions in the purchase agreement,” he added.
“Country Garden Holdings and its subsidiaries and entities are law-abiding businesses.”
He however, did not disclose how many had asked for refunds or whether it was seeking compensation from any of the buyers for breaking the sales contracts.
Meanwhile, some of the Chinese buyers who want to back out of the deal now claim that when they bought the units, they were not given the Chinese-language version of the agreement to sign. As they signed only the English contracts; they were not aware of the exact terms.
Responding to this, Yu however said both the Chinese and English contracts contained the same terms and conditions, and did not contradict one another.
“Our sales and marketing team at Forest City does make the time and effort to carefully explain the terms and conditions to buyers before they sign the contract,” he said.
Property lawyer Derek Fernandez told TODAYonline that a 30 percent penalty clause was “not normal” by Malaysian standards.
“In the event the buyers cannot get a loan to finance their purchase, then the down payment should be refunded. If they have breached the agreement, then only the down payment should be forfeited,” said Fernandez.
Yu however said that the 30 percent penalty clause was not a down-payment fee.
“The terms and conditions outlined in our sales and purchase agreements are in accordance with Malaysian laws and standards,” he added.
The Forest City development has been heavily marketed to China investors, prompting questions of sovereignty.
Developed by Country Garden, China's third largest developer, buyers’ ability to pay for the unite has been affected after China's capital controls.
The Chinese government had in January barred its citizens from converting the yuan into other currencies to purchase overseas property.- Mkini
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.