Chart of the Day: 15 Chinese Provincial Capitals Scrap Homebuying Curbs
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Two more major Chinese cities lifted homebuying restrictions late last week, joining a growing number of provincial capitals to completely scrap the rules as the authorities try to salvage the cratering real estate market.
Authorities in Hangzhou announced the lifting of all remaining restrictions on residential property purchases Thursday, meaning any buyer can “buy as many units as they want,” a member of the city’s housing security and management bureau told Caixin.
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- Hangzhou and Xi'an, major Chinese cities, have lifted all homebuying restrictions to boost the struggling real estate market, allowing unrestricted property purchases.
- This policy change aligns with national directives from China's Politburo meeting, which emphasized reducing housing stock and optimizing supply to stabilize the market.
- Despite these measures, overall market confidence remains low, with a UBS survey indicating unchanged home buying intentions and expectations of further price declines.
Two major Chinese cities, Hangzhou and Xi’an, recently lifted all homebuying restrictions in an effort to boost the struggling real estate market. This move allows buyers to purchase unlimited residential properties in these cities [para. 1][para. 2]. The decision is part of a broader trend across China where numerous provincial capitals have eliminated such restrictions following directives from high-level policy meetings aimed at reducing housing inventories and stabilizing the market [para. 1][para. 3][para. 5].
The removal of homebuying curbs is seen as a positive development by industry experts, signaling a shift in policy focus from controlling price surges to clearing existing housing stocks and revitalizing market confidence [para. 4][para. 5]. This change comes after years of regulatory measures designed to temper the previously soaring property prices [para. 6]. Analysts from Citic Securities highlighted that while the reliance on real estate as a primary economic driver in China has ended, addressing its residual effects remains challenging [para. 4].
As of now, 15 provincial capitals including Chengdu, Wuhan, and Nanjing have completely removed purchase restrictions. Several mid-sized cities like Jiaxing and Qingdao have followed suit. However, major metropolises such as Beijing and Shanghai still maintain some buying limits, albeit with cautious easing measures recently implemented [para. 7].
Despite these policy relaxations, public confidence in the property market remains tepid. A survey conducted by UBS Group AG indicated that only 23% of respondents planned to buy homes within the next two years—a figure consistent with previous months but showing a slight increase from last year. Additionally, there is an expectation among many that property prices will continue to fall over the next year [para. 8].
Overall, while policy shifts suggest potential support for the real estate sector, significant challenges persist due to weak market sentiment. Experts argue that without substantial policy intervention soon, the property market may face further risks [para. 8].
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