Interesting article:
news.bbc.co.uk/[...]

Liumingke1234, I agree with you that there is a difference between a new and an old house, especially between a new development project and an old one built in the 70's. However, there are many many "second-hand" houses on the market that are recently built but have never been occupied and in fact, is still in the condition in which it was delivered, i.e., in its 'mao pei' (bare concrete) state. Or, another option is to purchase a house that is nearly complete directly from the developer at market rate to avoid paying the taxes associated with second-hand houses.

LuJingLin was right on the money when he said Chinese investors and just too casual and careless when it comes to make such a large investment. This is a large sum of money and shouldn't be handed over without carefully scrutinizing everything.

The crux of the problem seems to be that the buyers entered into a contract that gave them the rights to purchase the house upon completion rather than an actual purchase contract in which they though they were signing. As with most Chinese mentality, they didn't bother carefully reading the contract because 1) they believe a contract is not worth the paper it is written on in China and they can use other method to enforce their will; 2) they were too exuberant about scooping such a "deal" and placed too much trust in the developers that they would honor the deal, a bad preposition in the first place.