Rows of new homes in Nanjing, East China's Jiangsu Province in March 2017 Photo: IC
More Chinese cities have announced new measures to restrict real estate purchases and ownership to curb rising prices, as the central government vows to rein in overheating prices in some cities while reducing excess supply in others.
On Wednesday, at least three cities - Nanjing, capital of East China's Jiangsu Province, Qingdao in East China's Shandong Province and Ganzhou in East China's Jiangxi Province - announced measures to rein in skyrocketing housing prices.
Nanjing prohibited new home purchases for registered residents who already owned two or more dwellings. It also expanded areas under earlier measures that banned non-registered residents who already owned one or more houses from purchasing another, according to a government announcement posted online. It was the second time the city introduced new restrictions since September 2016.
Qingdao and Ganzhou introduced similar restrictions on new purchases, and both cities also increased down payments. In Qingdao, for instance, the minimum down payment for a new home has been increased from 20 percent to 30 percent of the total price for residents who already own one or two homes. The city also suspended mortgages for purchases for third homes, the Economic Daily newspaper reported on Thursday.
Housing prices have continued to heat up this year in many major cities, including Nanjing and Qingdao, according to data released on February 22 by the National Bureau of Statistics (NBS).
In Nanjing, prices for new homes surged by 35.4 percent year-on-year in January, while Qingdao saw a year-on-year increase of 13 percent, according to the NBS data. Beijing, Shanghai and Guangzhou also saw price surges in January, rising 24.7 percent, 23.8 percent and 24 percent year-on-year, respectively, the data showed.
But rising prices do not seem to have curbed demand in these cities. In Beijing, a 100-square meter apartment listed at between 9 million yuan ($1.3 million) and 10 million yuan will be sold within a day or two, a Beijing resident who has been looking to buy one told the Global Times on Thursday.
The resident, who gave her surname as Liu, said that the competition to buy an apartment in better school districts has become so fierce that some sellers will "raise the price by 80,000 yuan instantly."
Given recent surges in some major Chinese cities, more measures will likely to be introduced to curb prices, according to Yan Yuejin, research director at the Shanghai-based E-house China R&D Institute.
"There will be more cities imposing tightening policies and market regulations this year," Yan told the Global Times on Thursday, adding that policymakers during this year's two sessions, also set a tone for tightening housing policies in cities with fast-rising prices.
A government work report, released during the meeting that concluded on Wednesday, said that the government will take a "city-based approach" to tackle issues in the divergent real estate sector. It will help third- and fourth-tier cities destock by ensuring demand, while curbing rising prices in some major cities by increasing land supply and tightening regulations.
With the government giving more attention to the issue, tougher measures to cut excess supply and curb prices will be seen this year, according to Yan.
However, the restrictions are aimed at cracking down on speculation and other illegal activities in the housing market, Yan said.
"For consumers who are buying apartments to live in, there's no need for worry, especially those with stable jobs … after all, the restrictions target speculative demand," he said.