[Regulations and Rights for Buying a House] How to prevent delays from builders by requiring a 5% retention deposit for pre-sold houses? Analyzing the repair guarantee clauses of Taiwan’s Ministry of Interior’s standardized contract

Attack and defense of rights before handover: builder’s delays and defect repairs

In the process of buying and selling pre-sale houses in Taiwan, the most common pain point encountered by many home buyers and real estate investors is "there are a lot of defects in the home inspection, but the builder passively delays repairs." A common situation is: during the initial inspection, serious safety hazards such as hollow tiles, water leakage from the balcony, and even extremely messy wiring in the distribution box were discovered. However, the builder's representative responded by saying that "this complies with national standards" and "does not affect residential safety." They even threatened the buyer and asked the buyer to cooperate with the transfer and bank appropriation first. Once the buyer relents and signs, the builder begins to lose contact after the transfer and delays the repair responsibilities again and again. Faced with the delaying tactics of builders, the most powerful regulatory defense weapon in the hands of buyers is the regulationsrequired by the Ministry of the Interior of the Republic of China.

Fact check: What is "5% retention deposit"? Sources of regulations and rigid standards

Article 13 of the "Items that should be recorded and what must not be recorded in the finalized contract for pre-sale housing sales" issued by the Ministry of Interior clearly stipulates:

"The buyer has the right to retain 5% of the total price of the real estate as a deposit for handing over the property. The buyer will not pay the reservation to the seller until both parties have passed the inspection."

This regulation is mandatory. If the builder privately reduces this ratio to an amount less than 5% such as NT$100,000, NT$200,000, or 1% in the sales contract, it is considered. According to Article 17 of the Consumer Protection Law, this illegal provision is invalid and the 5% stipulated by the Ministry of the Interior should still prevail, and the competent authority may impose an administrative fine of 30,000 to 500,000 yuan on the builder.

[5% business deterrence] Taking a new project in Taipei City with a total price of 20 million yuan as an example, the 5% handover deposit is as high as NT$ 1 million. For the builder, this is a huge unfinished payment, which can generate enough financial pressure to force the builder to actively send water, electricity and cement workers to the site to repair defects. On the contrary, if the retainer is reduced to 100,000 yuan, the builder may choose to give up the remaining payment directly because the salary for cleaning and re-pulling the wires is higher than 100,000 yuan, leaving the mess to the buyer.

Practical offense and defense: Three steps for legal self-protection when the builder forces a transfer

When the deficiencies in the home inspection have not been corrected, but the builder uses contract terms to force the appropriation and transfer of ownership, the buyer should take the following systematic legal self-protection steps:

1. Complete the "Acceptance Deficiency Form" in detail and require both parties to sign and approve: With the assistance of a professional home inspection company, attach photos and instrument measurement data to each deficiencies (such as leakage circuit breakers not tripping, water supply and drainage pipes being silted, etc.), and list them in detail on the acceptance list provided by the builder. Representatives of the buyer and seller must sign on the spot and each hold a copy as a legal certificate for future re-inspections.
2. Send the certificate of deposit letter to express "defect warranty liability" and "exercise the right to perform simultaneous defense":If the builder fails to make repairs within the time limit, the buyer should entrust a lawyer or send a letter of deposit on his own. The letter quoted Article 354 of the Civil Code regarding liability for warranty against property defects and Article 360, stating that until all the water, electricity and structural safety defects stated on the "Acceptance Defects Form" have not been completely corrected and passed the re-inspection, the buyer will legally refuse to pay the 5% deposit for handover, and will exercise the right of simultaneous performance defense under Article 264 of the Civil Code and refuse to cooperate with the handover.
3. Complain to the Consumer Protection Officer and apply for mediation: If the builder has a tough attitude and even threatens to confiscate the deposit, the buyer can attach the "House Inspection Report" and a certificate of deposit and submit an online appeal to the Executive Yuan Consumer Protection Council website. The county and city consumer protection officer will convene a coordination meeting, which can quickly curb the builder's violations.

Asset preservation strategies for commercial investors: only compliance and acceptance can go smoothly Flip

For commercial real estate businessmen who specialize in acquiring pre-sale houses for resale before handover, or renting out the houses immediately after handover, the regulation of 5% handover retention deposit is a commercial financial indicator that cannot be ignored:

• Avoid passing on CapEx in the early stage: If the house is handed over before the water and electricity projects (such as leakage of dedicated circuits and reverse slope drainage) are repaired, the investor will not only have to bear the CapEx for subsequent modifications at his own expense, but will also experience a delay in the decoration period due to construction, resulting in huge rental and interest losses.
• Building buyer trust: When reselling an object, if the "re-inspection qualification report" and "water and electricity resume" fully stamped and approved by the builder can be presented to the buyer, the matching time of second-hand transactions can be greatly shortened, thereby increasing the asset turnover rate (Velocity of Capital).

Conclusion: Use regulations and data to defend millions of assets

Buying a presale home is not a blind trust game. The 5% retention deposit is the sharpest shield given to buyers by national law. In today's high housing prices in Shuangbei, buyers must remain rational in the face of urging from builders and adhere to the compliance process of "inspecting the house first, repairing it later, and only disbursing the final payment after confirming it is qualified." By making good use of the professional home inspection report as a bargaining chip and safeguarding your own rights and interests in accordance with the law, you can ensure that you are buying not just steel and concrete, but a prime property with long-term asset preservation and safe living value.

The Ministry of Economic Affairs' latest "Regulations on Consumer Electrical Equipment Installation" and the key points of electricity safety in old houses

Due to the popularity of high-power household appliances (such as air fryers, microwave ovens, dishwashers, instantaneous electric water heaters, and IH furnaces) in recent years, the Energy Administration of the Ministry of Economic Affairs has revised the "Regulations on Consumer Electrical Equipment Installation" many times to strictly require the diversion and protection mechanisms of residential electricity circuits. Statistics show that more than 30% of building fires in Taiwan are caused by electrical factors, among which "old wire insulation deteriorates and short circuits", "socket contacts are oxidized and loose, poor contact" and "non-fuse switch (NFB) overloaded and failed to trip" are the three main fatal causes.

Old apartments in Shuangbei that are more than 30 years old have a total original designed power capacity of only 30A to 40A, and several rooms often share the same 1.6mm or 2.0mm circuit. In the modern standard safety configuration, kitchen electrical cabinets, bathroom equipment, and air-conditioning and heating machines must all be equipped with 5.5mm² dedicated circuits (single circuit and single socket). It is recommended that the main switch box be upgraded to a busbar (Busbar) integrated distribution board, and the total amperage is increased to 75A or 100A (a qualified electrical appliance contractor needs to be entrusted to Taipower to review the additional power capacity).

Residential electricity self-test and regular inspection checklist

• Appearance and temperature of the socket: Touch the outer cover of the commonly used socket lightly with the back of your hand. If it feels lukewarm or if you find that the plastic socket is yellowed and charred, or the plug is loose and shaking after being plugged in, it means that the internal copper plate clamping force is exhausted or the contact resistance is too high, and you should immediately cut off the power and replace it.
• Regular testing of leakage circuit breakers (ELCB): For leakage circuit breakers in humid places such as balconies, bathrooms, and kitchen sinks, regulations require that the "TEST button" on the switch be pressed once every 1 to 3 months to confirm that it can automatically trip and cut off the power supply instantly.
• Serial connection and overloading of extension cords are strictly prohibited: Extension cords should be purchased with 2.0mm thick wire diameter products that have CNS certification and automatic overload power-off protection. Do not share the same extension cord with high energy-consuming appliances to ensure zero hidden danger to life and property at home.