Hong Kong developers keep the faith in property agent Midland Realty despite commission fixing allegations

Property developer association says its members will continue to do business with Midland even as antitrust watchdog takes legal action against the agency

Property agencies Midland and Centaline, are involved in nearly 90 per cent of the property transactions in Hong Kong, the world’s most expensive real estate market

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People passing by Midland Realty’s Austin Road branch in Jordan. The Competition Commission is taking legal action against Midland Holdings and two of its real estate agencies, accusing them of conspiring with other firms to set minimum commission rates. Photo: Jelly Tse

Published: 7:15pm, 16 Nov 2023

Hong Kong developers will continue to work with Midland Realty, a leading real estate agency in the city, which recently became embroiled in an alleged sales-commission-fixing scandal, the head of an apex body of the city’s real estate companies said on Wednesday.

The city’s antitrust watchdog Competition Commission is taking legal action against Midland, accusing the company and two of its subsidiaries of directing agents to charge a minimum net commission rate of 2 per cent for first-hand residential properties starting on January 1. The net commission rate is what property developers pay to real estate agencies after deducting their expenses, such as rebates.

“Developers and property agents are as close as lips and teeth,” said Stewart Leung, chairman of the Real Estate Developers Association (REDA).“Our collaboration with Midland will not change because of this incident, and we will continue to do business with them.”

He highlighted the role played by large-scale property agencies in attracting customers.

Potential buyers line up for sales of Wheelock Properties’ Miami Quay, at the Tower 2 Gateway sales offices in Tsim Sha Tsui. Photo: Jonathan Wong

“Big property agencies like Midland have the most number of agents and more customer sources, so whenever someone is selling a property, they will definitely contact these agencies,” he said.