Chinese cities impose new property controls

A number of provincial capitals across China have rolled out new curbs to further slow home property sales, and bear down on lingering speculators that could destabilize markets ahead of a key Communist Party congress next month.
Shijiazhuang, capital of Hebei province, has banned investors from selling newly bought homes for up to five years, while Changsha, capital of Hunan province, has barred homeowners from buying a second property for up to three years from the time of their first home purchase, according to the official Xinhua News Agency.
Changsha has also limited property sales to non-local residents to one unit per person.
Home prices have surged since late 2015, with the country’s biggest cities including Shenzhen and Shanghai the first to see huge spikes in their markets. Provincial capitals started to join in the fray last summer as speculators flooded into tier-two cities.
The government, concerned about potential instability posed by frothy property markets and soaring credit growth, has increasingly clamped down on speculators since late last year, unleashing a series of restrictions to douse the country’s super-hot home property markets.
Average new home prices in China’s 70 major cities rose 0.2 percent in August this year from July, the slowest pace in seven months, according to the latest official data.
Prices of homes in China’s tier-one cities including Beijing, Shanghai, Shenzhen and Guangzhou either fell from a month earlier or were unchanged. One outlier was Chongqing, in southwest China, where prices inched up 0.3 percent from July.
Authorities in Chongqing, along with those in Nanchang in the Jiangxi province, have since banned transactions of new and second-hand homes for two years after purchase, according to documents published on the municipal governments’ official websites.
The various measures took effect last week.
Additionally, Xian, capital of Shaanxi province, has told developers from Monday to report home prices to local price-monitoring departments before sale, and reiterated its pledge to crack down on property price manipulation and speculation.
Signs of a more stable housing market will be good news for the Communist Party as it prepares for a once-in-five-years congress, a politically sensitive time.
China’s property market has become a major source of financial risk. A central bank official earlier this month said authorities needed to maintain strict controls over property markets in first and second-tier cities where prices gains have been the strongest.
Short-term household loans in August doubled from July to 216.5 billion yuan ($32.85 billion), as some home buyers may be turning to short-term consumer loans due to curbs on mortgages, analysts say.

Source: Arab News