Research on the Reconstruction of the Regulatory System for Pre-Sale Funds of Commodity Housing

In recent years, China has witnessed frequent incidents of unfinished buildings resulting from regulatory failures in pre-sale funds under the commercial housing pre-sale system. These incidents have severely compromised consumers rights and interests, even posing threats to financial security. Against this backdrop, this paper focuses on the systematic reconstruction of the pre-sale funds supervision framework for commercial housing. Within the context of preserving the pre-sale system, we propose an enhanced approach centered on bank-led supervision with multi-stakeholder collaboration. This approach emphasizes establishing banks as the core regulatory entities, leveraging their professional risk control capabilities to implement efficient oversight through dedicated closed-loop accounts, credit assessments, and dynamically linking fund disbursements with construction progress. Concurrently, we advocate establishing a pre-sale permit mechanism mandating bank supervision as a prerequisite, engaging professional institutions (e.g. law firms and accounting firms) for collaborative oversight, enhancing public risk awareness education, and utilizing incentive mechanisms with market elimination mechanisms to promote developers standardized operations. This comprehensive suite of measures aims to safeguard consumers interests, regulate the pre-sale market order, and foster the healthy development of the real estate market.