Spot of parking trouble

2016-03

REAL ESTATE AGENTS should provide accurate information to prospective purchasers, and take reasonable steps to verify the related information. Otherwise, they may be subject to disciplinary action by the Estate Agents Authority.

A client was interested in buying a car parking space at a project costing about HK$500,000 because of the potential gross monthly rental yield of some HK$2,000.

However, an agent told her the sale of parking spots at that development had not yet been made available to the public.

Instead, the agent persuaded her to consider buying a spot at another project – at a much lower price of around HK$200,000, with monthly rental income of about HK$1,700.

On being told the price and rental yield of the parking spaces at the second development were more attractive, the client decided to buy two spaces there.

She later listed the spaces with several large estate agencies for leasing. But to her dismay, she found the market rents could only fetch about HK$1,000. She thus lodged a complaint against her original agent with the authority.

The authority’s disciplinary committee conducted an inquiry.

According to information from the Rating and Valuation Department, the monthly rentals of the two car parking spaces concerned during the relevant financial year did not exceed HK$700 each – much lower than the amount claimed by the estate agent.

Due to his misrepresentation on the rental of the parking spaces, the agent was found to be in breach of the code of ethics, which states: agents and salespersons should avoid any practice which may bring discredit and/or disrepute to the estate agency trade.

He was reprimanded by the disciplinary committee, fined HK$3,000 and a condition was attached to his license, requiring him to obtain 12 points under the Continuing Professional Development Scheme within 12 months.