In recent years, the Chinese real estate market has been in a difficult situation, with unfinished buildings becoming a symbol, leading to continuous rights protection incidents. More than 400 employees of China Petrochemical Corporation (Sinopec) were arranged by the unit to collectively purchase commercial housing in Xi’an 12 years ago, facing a nine-year delay in delivery, and still struggling to protect their rights.
According to a report by The Paper on May 26th, the employees of Changqing Transport Company, a subsidiary of China National Petroleum Corporation (CNPC), reflected that in 2013, they subscribed to commercial housing – Zhen Guan Shou Du developed by Shaanxi Gao Hong Real Estate Co., Ltd. The property, which was supposed to be delivered in May 2016, has been stalled and overdue for 9 years.
Zhen Guan Shou Du is located on Fengcheng Sixth Road in Xi’an, with a total of four residential buildings and one office building planned in the community, accommodating approximately 500 households. At the end of 2013, when employees of Sinopec collectively purchased the property, the average price was 5500 yuan per square meter.
Ms. Zhang’s husband works in Changqing Transport Company. She told the media that in November 2013, Changqing Transport Company signed a house purchase group agreement with Gao Hong Real Estate Company and organized employees to participate in the group purchase. She purchased a unit in Zhen Guan Shou Du at a price of 5500 yuan per square meter, totaling 460,000 yuan.
In addition to Changqing Transport Company, more than 400 employees of the CNPC system also participated in this group purchase, many of whom are from other provinces such as Ningxia, Gansu, and Sichuan, raising funds exceeding hundreds of millions of yuan.
It was reported that the agreement signed at the time was not a housing sales contract, but a “Residential Subscription Agreement.” Before the group purchase was initiated, Zhen Guan Shou Du did not have a complete sales license, and Changqing Transport Company was aware of this. According to regulations, real estate developers are prohibited from selling to the public without obtaining a “Pre-sale Permit for Commercial Housing.” They also cannot sell properties in an indirect manner through subscriptions or collecting deposits.
The subscription agreement stipulated that after the agreement was signed and the subscribing party paid the earnest money to the transferor, construction should begin within 10 working days, starting from November 15, 2013, and the property should be delivered by May 15, 2016, within 30 months, with the specific delivery date to be notified by the transferor. Failure to deliver the property on time is considered a breach of contract.
However, when the May 2016 delivery date arrived, they did not receive the property, and the project did not continue construction but remained in a stagnant unfinished state. Subsequently, the homebuyers began fighting for their rights.
It is reported that in 2019, when a creditor obtained equity in the development company involved in the project and became the new person in charge of the company, they claimed to resolve the outstanding issues from the previous period. However, after the project construction started for a period, it was halted again due to financial problems. Local authorities were approached for help, but the issues remained unresolved. Many people expressed feeling trapped in a situation where they have nowhere to get their houses and no hope of receiving a refund.