32 property owners in Longhua, Shenzhen, were scammed when buying small property rights homes and nearly lost their houses. A lawyer spent a year and a half helping them confirm their ownership rights.

In the summer of 2023, when Uncle Chen from Longhua, Shenzhen, came to us with a "Cooperative Housing Construction Agreement," his hands were trembling. The small property rights apartment he had bought in Dalang, Longhua, where he had lived for nearly eight years, was suddenly sealed off after the original villager's creditor filed an application for seizure. There were 31 other households in the same building in the same situation. Some had drained the savings of six wallets, while others had sold their homes back in their hometowns to scrape the money together, with the total subject amount exceeding 40 million yuan. Put plainly, after living there for so many years, they had no property ownership certificate and no legal "status." Once the property was sealed and auctioned, they could end up with nothing.

Uncle Chen said that when he bought it back then, he knew it was a small property rights house, but the agent patted his chest and said, "There are tons of cases like this in Shenzhen, everyone lives like this." The developer was a collaboration between original villagers and an out-of-town boss, and what was signed was a "cooperative housing construction" agreement, but in reality it was just selling houses. For the first few years, everything was fine, but later the original villagers ended up drowning in debt, and the creditors set their sights on this building and directly applied to the court for seizure. All 32 households panicked at once. Some went to block the developer's door, some went to petition, and after more than half a year of running around, the seizure was not lifted. Instead, they received a court auction notice.

Where exactly is the legal deadlock here? Small property rights housing is not recognized as real rights under the law. The buyer cannot obtain a real estate ownership certificate, and when the court seizes the property, the registered right holder is still the original villager. All you have in hand is a contract, and trying to fight the court's seizure is extremely difficult. But "extremely difficult" does not mean "impossible to fight." The key depends on two points: first, whether you have actually taken possession and used it; second, whether you have paid consideration. Article 28 of the Supreme People's Court Provisions on Several Issues Concerning the Handling of Execution Objection and Reconsideration Cases provides protective conditions for the real right expectation right of a no-fault buyer - a written contract, actual possession, full payment of the price, and failure to transfer ownership for reasons not attributable to oneself. Uncle Chen and the others basically meet all four of these conditions.

After we took over, we didn't rush to file an enforcement objection. Instead, we did one thing first: we organized the purchase contracts, transfer records, utility bills, property management fee receipts, and community residency certificates of all 32 homeowners into files on a per-household basis. Each family's situation was different—some had paid in full, while others still owed tens of thousands in remaining payments; some contracts stated "cooperative housing construction," while others said "transfer of use rights." These details directly determined whether the case could stand. Director Shen Jinlong said one thing at the time: "The biggest fear in group cases is lumping everything together—you must have one strategy per household."

Strategically, we'll take it in two steps. First, in response to the court's seizure and auction, file an enforcement objection as a third party outside the case, asserting the right to expect real rights, and simultaneously apply for a suspension of enforcement. Second, file a concurrent lawsuit to confirm rights, requesting the court to confirm the owner's lawful right to possess and use the property, and to require the original villagers and the developer to cooperate in handling the relevant procedures. These two steps must be well coordinated. Filing an objection without confirming rights means that even if the seizure is lifted, the property is still not protected; confirming rights without blocking enforcement means the property may already have been auctioned off.

The process was more grueling than anticipated. There were three hearings on the enforcement objection alone, and the opposing creditor clung to one argument: the sale contract for the small property rights housing was invalid, so the buyer was not a "legitimate buyer" and was not protected under Article 28. Our response was straightforward: the validity of the contract should be handled in a separate case, but the facts were clear — the buyer had paid consideration, had been in actual possession for years, and was not at fault for the failure to transfer title. The court ultimately adopted our position and ruled to suspend enforcement. Immediately after, the title confirmation lawsuit was filed in Longhua Court, with 32 households consolidated for trial, and just the evidence exchange alone required four trips.

At the end of 2024, the verdict came down. The court confirmed that the 32 property owners had rights to possess and use the properties in question, and that the original villagers and the developer must not interfere. Although they did not get that "red certificate," at least the homes were preserved and would not be auctioned off. If urban renewal or land consolidation were to occur later, the owners' compensation rights would also have a legal basis. On the day Uncle Chen received the judgment, he smoked a cigarette downstairs from the law firm and said, "For the past year and a half, I haven't been able to sleep well."

After handling this case, there are a few reminders I want to make clear to homebuyers in Shenzhen. First, the risks of small property rights housing are systemic and cannot be resolved simply by "signing a contract and having a lawyer witness it." Second, if you have already bought one, be sure to keep all payment receipts and evidence of residence. Don't throw away utility bills, and don't miss community registration. Third, once you encounter seizure, auction, or the original village resident going back on the deal, don't delay. The earlier a professional lawyer gets involved, the more room there is to fight for your interests. In Shenzhen's Futian, Nanshan, and Longhua districts, urban renewal has been rapid in recent years, and the historical legacy problems of small property rights housing will only increase, not decrease.

Q: If I bought a small property rights house in Shenzhen and the original villager goes back on the deal and wants to take it back, how will the court rule?
Answer: Courts typically will not directly order the transfer of ownership, because small property rights housing itself does not meet the conditions for registration. However, if you have already paid the full purchase price and have actually lived there for many years, the court may confirm your right to possess and use the property, and the original villager cannot take it back at will. The specifics depend on the contract terms, payment evidence, and the facts of occupancy. Each household's situation is different, and the outcomes vary accordingly.

Guangdong Zhiming Law Firm has been rooted in Shenzhen for 26 years, handling over 10,000 cases cumulatively, and has accumulated extensive practical experience in real estate disputes in Futian, Nanshan, Longhua, and other areas. If you are facing issues such as being scammed when buying a home, a stalled property transfer, one house sold to multiple buyers, or disputes over small property rights housing, you can come directly to Room 1802, Tower A, Xintian Century Business Center, Shixia North 2nd Street, Futian District, Shenzhen to talk in person, or call 0755-25986969 for a preliminary consultation first. When it comes to housing matters, you can't afford to delay.