BEIJING, May 30 -- China'central government made it harder to buy a home and more expensive to sell one yesterday as it announced a string of new loan and tax policies designed to cool the booming real estate market.

    Down-payment requirements for residential units bigger than 90 square meters will be raised to 30 percent from 20 percent starting June 1, the State Council said yesterday.

    The move follows an earlier order by the central bank that commercial lenders impose higher down payments in areas where price growth is "excessive." But that action, and others implemented by state and local authorities, failed to stop home prices from escalating in many cities this year, raising fears of an unsustainable price bubble.

    Housing prices in 70 major cities across the nation rose 5.6 percent last month from a year ago, the State Development and Planning Commission said last week.

    Beijing residential units posed a 15 percent gain in the first quarter from a year ago, and cities such as Shenzhen in Guangdong Province and Dalian in Liaoning Province reported more than 10 percent price growth.

    Shanghai was the only city to post a decline in new-home prices last month, a 6.2 percent drop.

    The other actions effective on June 1 include a 5.5 percent tax on the total sales price of the property within five years, up from the current two years. Property sold after five years will be subject only to a 5.5 percent tax on capital gains, or the profit a seller reaps from the transaction.

    "Whether the sales tax will be transferred from sellers to buyers depends on the ratio between supply and demand," said Chen Sheng, a tax expert at the China Academy of Real Estate.

    Shanghai's housing market, the central target of similar regulatory measures last year, may slow further.

    Ye Ying, an analyst at Shanghai 1Fang Co Ltd, a real estate services company, forecast that the supply of second-hand homes will increase as a result of the new tax policy.

    "Speculators who could hold onto their property for two years under the previous policy may find it difficult to wait another three years and will be anxious to put it up for sales," she said.

    Yin Kunhua, a professor at Shanghai University of Finance and Economics, was critical of the state's broad-brush approach. "The city's housing market has just shown healthy signs of a rebound with stable prices and gradually increasing transactions," he said. "Besides, the tax policy is obviously unfair to owner-buyers."

    Li Bin, a 30-year-old white-collar worker is among them. He was planning to sell his apartment and his parents' flat and buy a larger place where he could take care of them.

    "The tax is too heavy for me," Li said.

    (Source: Shanghai Daily)