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May 22, 2018

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Home » Business » Real Estate

China reiterates stringent rules on property to stay

Source: Xinhua | 00:01 UTC+8 May 22, 2018 | Print Edition

China’s top property market watchdog reiterated over the weekend that it will maintain tight regulation of the real estate sector.

Local governments should stick to real estate market management goals and not loosen regulatory measures, according to a statement on Saturday by the Ministry of Housing and Urban-Rural Development, citing notices of market speculation in some cities.

This is the second time that the ministry has voiced its concerns and stance over the real estate market in 10 days.

The ministry arranged talks on May 9 with senior government officials from Chengdu and Taiyuan on property market regulation after official data showed that both cities saw prices of new and second-hand houses rise year on year in March.

The ministry stressed on Saturday that “houses are for living in, not for speculation” and urged the officials to take specific measures to ensure stable and healthy development of the local property market by stabilizing housing prices and rent as well as reducing leverage.

First-and-second-tier cities are asked to finish a five-year housing development plan by the end of this year, while a crackdown will be imposed for spreading misleadingly speculative information via social media platforms.

Local governments that fail to rein in runaway housing prices will be held accountable, the ministry said.

It also recently met with senior government officials from another 10 cities, including Xi’an and Haikou, on real estate market management.

“The new measures mean housing market regulation is upgrading from tailored policy-making to the evaluation of the effects of regulation,” said Zhang Dawei, chief analyst with Centaline Property.

Official data showed last week that on a yearly basis, new housing prices in China’s first-tier cities declined further in April compared with March, while price growth slowed in second- and third-tier cities.

However, 58 of the surveyed 70 cities saw month-on-month rises in new housing prices, especially in second- and third-tier cities.

Zhang observed that many cities saw housing prices rise after they lowered household access qualifications to attract more professionals to work in the cities.

Over 50 cities have rolled out preferential policies, including housing subsidies, as local governments try to attract more talented professionals to invigorate local economies.

Local governments such as Chengdu have adjusted their policies to contain housing market speculation after being warned by the central government.

Moody’s observed in a report that Hainan Province has introduced the strictest measures so far this year following an announcement by the central government that it would support the establishment of a free trade zone on the island.

Hainan launched a campaign on Sunday to lure big companies to set up regional and international headquarters on the island, while real estate developers are excluded from the list of qualified enterprises.

The government might not relax its controls over the next 6 to 12 months as it continues to halt a rise in property prices, according to Moody’s.

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