Following is a question by the Hon Ronny Tong and a written reply by the Secretary for Development, Mr Paul Chan, in the Legislative Council today (May 22):
Question:
It has been reported that the price of penthouse flats with rooftops of a residential development, which has been completed for intake recently, is almost $30 million each, but the occupiers need to pull down the folding maintenance ladders installed at the ceilings inside their flats, climb up to the top of the ladders and push open the skylight windows in order to reach the rooftops which are completely fenceless, making it difficult for the occupiers to use the rooftops. It has also been reported that "inaccessible flat roof, access for maintenance only" was specified in the building plans submitted by the developer concerned to the Buildings Department (BD) for vetting and approval. However, the Agreements for Sale and Purchase of such flats not only had no mention of such restriction but specified that owners were entitled to use the rooftops. In this connection, will the Government inform this Council:
(a) whether it is mandatory for the developer concerned to apply to BD for amending the building plans and obtain BD's approval before it may sell to prospective buyers the aforesaid rooftops, which are accessible for maintenance purpose only; if it is not, of the reasons for that; if it is, the criteria adopted by BD for vetting and approving such applications, and whether the Lands Department will request the developers to pay premiums;
(b) whether it knows the number of developers in the last decade which had adopted the same or similar practices to increase the saleable area of residential flats; whether the Government had exercised control over such practices; if it had, of the details; if not, the reasons for that;
(c) whether it is a criminal offence for a developer to withhold information on the actual use of certain areas of a residential development in the building plans submitted to BD; how the Government follows up such cases; of the number of such cases uncovered by the authorities in the last decade, and the details of such cases; and
(d) whether the authorities will prohibit developers from selling fenceless rooftops to prospective buyers in order to avoid accidents; if so, of the regulations and justifications based on which such sale may be prohibited; if not, the reasons for that; whether the authorities had uncovered similar cases in the last decade; if so, of the number of such cases and their details?
Reply:
President,
The Buildings Ordinance (BO) aims to regulate the planning, design and construction of buildings and associated works on private land and, for this purpose, to prescribe building standards on various aspects such as structural and fire safety as well as sanitation. Matters concerning property transactions fall outside the jurisdiction of the BO. The Buildings Department (BD) enforces control on buildings and associated works in accordance with the powers conferred by the BO. Under the BO, any person intending to carry out building works is required to appoint an authorised person (AP) and, where necessary, a registered structural engineer (RSE) and/or a registered geotechnical engineer (RGE) to prepare and submit building plans for approval by BD, unless the works fall within the scope of designated minor works that can be carried out under the simplified requirements of the Minor Works Control System or such works are exempted works. The person must also appoint a registered general building contractor (RGBC) and a registered specialist contractor (RSC) to carry out the building works in accordance with the approved plans. After the building plans have been approved, the AP must obtain written consent from BD before commencement of works.
On the other hand, the Government respects and protects, in accordance with the law, the right of individuals and legal persons to the acquisition, use and disposal of their property. Private residential developments are the private property of the owners of the developments. Under lawful circumstances, the owners of private residential properties are free to offer their properties for sale. At the same time, the Government understands that the purchase of a flat is a major undertaking for most people and that vendors and purchasers of first-hand residential properties are not on an equal footing. The Government has been striving to enhance the transparency and fairness of the sales of first-hand residential properties and consumer protection, with a view to ensuring that vendors will provide clear, comprehensive and accurate information on residential properties to the purchasers. In this connection, the Residential Properties (First-hand Sale) Ordinance (the Ordinance) was brought into full implementation on April 29, 2013.
My reply to the four-part question is as follows:
(a) As matters concerning property transactions fall outside the jurisdiction of the BO, it is not necessary for a developer to apply to BD to sell a "rooftop accessible for maintenance purposes only", and no amendment of building plans is involved. In respect of the land lease, it is also not necessary to apply to the Lands Department for the sale of such kind of rooftop, and no payment of land premium is involved.
(b) and (d) According to the Transport and Housing Bureau, standardisation of the definition of "saleable area" (SA) was one of the important tasks accomplished by the Government and is a major contribution to the improved transparency of information on sales of first-hand residential properties over the past years. Starting from October 10, 2008, the standardised definition of SA clearly delineates what is meant by the area of a residential property. If there is a balcony or a utility platform in the residential property, the areas of the balcony and/or utility platform are also included as the SA for the property. As regards other areas which form part of the residential property, such as a roof, although the vendor may sell those areas to the purchaser, the vendor cannot include those areas in the SA for the residential property.
To further enhance the transparency and fairness of the sales of first-hand residential properties and provide better protection to purchasers, the Ordinance was brought into full implementation on April 29, 2013. Under the Ordinance, when a vendor offers first-hand residential properties for sale, he must present the area and price per square foot and per square metre of the residential property in the sales brochures, price lists and advertisements only on the basis of SA according to the definition in the Ordinance. The definition of SA in the Ordinance largely follows the aforementioned standardised definition. For other areas which form part of the residential property, such as a roof, although the vendor may sell such areas to the purchaser, the vendor must set out those areas item by item and must not include them in the SA for that residential property. Moreover, the vendor or a representative of the vendor can no longer present the area of a first-hand residential property in the form of "gross floor areas".
Also, under the Ordinance, vendors should set out "relevant information" that is specific to a residential property in the sales brochure. In simple terms, if a piece of information is known to the vendor but is not known to the general public, and the information is likely to materially affect the enjoyment of the residential property, such information is "relevant information". If a residential property is connected to a rooftop and is sold together with a rooftop, but the owner of that property cannot use the rooftop in the normal manner, or the owner of the property is required to allow rooftop maintenance workers to enter his/her property in order to carry out maintenance work on the rooftop, and if this information is known to the vendor but is not known to the general public, such information is regarded as "relevant information" and must be set out in the sales brochure.
Agreement for Sale and Purchase (ASP) is an important document to protect the interests of both the vendor and the buyer in a residential property transaction. There are mandatory provisions in the Ordinance in respect of an ASP, including the setting out of the areas of a first-hand residential property according to the definition of SA in the Ordinance, and the setting out item by item of the other areas which form part of the residential property. The vendor and the buyer may suitably include in the ASP other provisions which are relevant to the transaction in order to clearly reflect the details and unique terms of the transaction. However, such provisions must not be in conflict with the mandatory provisions provided under the Ordinance.
The Administration does not have information on the number of residential properties which were sold with rooftops and the number of residential properties sold with rooftops for which fencing could not be mounted.
(c) Under section 40(2A)(c) of the BO, any person for whom any building works are being carried out and any AP, RSE, RGE, RGBC or RSC directly concerned with any such works who knowingly misrepresents a material fact in any plan, certificate, form, report, notice or other document given to the Building Authority under the BO shall be guilty of an offence and shall be liable on conviction to a fine of $1 000 000 and imprisonment for three years. Where BD identifies a situation involving a suspected contravention of the above provision, it will conduct investigation and take follow-up action and, depending on the circumstances and relevant evidence, consider instigating prosecution action. In the past decade, BD had instigated prosecution action in one case involving a contravention of the provision. As the legal proceeding of the case is in progress, it is not appropriate to disclose the details.
Ends/Wednesday, May 22, 2013
Issued at HKT 15:10
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