Beijing Adds New Restrictions to Try to Cool Down Housing Market
(Beijing) – The Beijing municipal government has rolled out a new set of restrictive measures to try to combat the latest frenzy in the housing market, raising the down-payment requirement for second-home purchases in the city to at least 60% from 50%.
The new restrictive measures, which went into effect on Saturday, also changed the definition of second-home buyers to include anyone who has a record of taking out a mortgage, even if they don’t own a home currently in the Chinese capital city.
Restrictions on home purchases have also been introduced in other cities recently, including Guangzhou, where people who don’t have a local household registration, known as hukou, will not qualify to buy an apartment until paying local mandatory payroll taxes for five years, up from three years.
People from Lianjia Real Estate Agent Co. Ltd. told Caixin that the prices of previously owned homes in February in Beijing went up by 4.6% compared with a month earlier, at an average price of more than 70,000 yuan ($10,144) per square meter.
The average housing prices in Beijing rose to 60,700 yuan per square meter in February from 52,500 yuan per square meter in last October, up by 15.6%, according to data released by Chinese Real Estate Industry Association.
Chinese developers will face stronger competition this year, as large developers strive to expand their market share amid the ongoing regulatory controls and expected slowdown in sales growth, said Moody’s Investor Services. The ratings company expects control measures in cities where property prices are rapidly increasing will become even tighter this year, whereas policies in lower-tier cities where inventory is high will remain accommodative.
Contact reporter Dong Tongjian (email@example.com)
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