LookAtVietnam Bridge - Police have launched an investigation into apartment sales of The Adonis 2 in Ho Chi Minh City after complaints were lodged by early buyers.

Property developer, Van Thinh Hung Properties Corp, had sold more than half of the 500 units before work started on the development. Under the Residential Housing Law, developers are allowed to sell apartments only after the foundation has been built.

Buyers also complained that apartments had been sold for floors 15 through 18, despite local zoning laws which cap high-rises at 15 storeys. Scores of customers have asked Van Thinh Hung to reimburse their deposits after questioning the legality of the project.

One customer paid a $86,950 deposit on four apartments in February when land prices were at absurd heights. “At that time people fought for apartment purchases. That’s why we were in a hurry to buy, without looking carefully at its legal status,” said the customer.

He said alarm bells began to ring when he saw Adonis 2 advertised as 22-storey buildings despite the 15 floor cap. Van Thinh Hung director, Duong Dang Khoi, said his company sold the units from between $1,300- $2,000 per sqm, generating VND75 billion ($4.6 million) in sales.

The Adonis 2 was initially owned by Hong Quang Investment, Construction and Urban Works Joint Stock Company. On January 26, 2008 Hong Quang sold it to Nguyen Do Limited Company. Two days later Nguyen Do – which came in for a 70 per cent stake - made a deal with Van Thinh Hung to co-develop the $56.8 million project.

Industry players are watching how authorities will handle this case in a market where developers often sell apartments off the plan.

(Source: VIR)