| (Xinhua file photo)
by Lu Hui
BEIJING, Feb. 25 (Xinhuanet) – China’s State Council on Wednesday restated its intention to maintain housing market tightening measures to limit property speculation and curb rocketing house prices in response to a rebound in the real estate market in some cities,
Analysts said the policy pledges signal Chinese government determination to rein in excessive home price rises amid a recovery in the property market across the country. Given the policies of “limiting purchase, prices and loans”, industry experts played down the risk of a sustained surge in housing prices this year, predicting that the future property prices will remain stable with sufficient market supply.
Continuity of property control policies
In a fresh bid to calm frothy real estate markets, China’s cabinet on Wednesday unveiled five policies, including improving responsibility system for stabilizing housing prices, curbing speculation in the housing market, increasing ordinary commercial housing and land supply for that purpose, accelerating construction on government-subsidized housing, and strengthening market supervision.
This is the fifth time that China has stepped up the housing market tightening measures since the government started macro control on real estate market in December 2009.
These five measures not only kept the continuity and stability of the macro-control policies, but also broadly restated measures China has rolled out in the past three years of steady campaigning to rein in excessive home price rises.
The State Council decided in a meeting chaired by the premier to keep curbs on the purchase of residential housing for investment purposes and to expand experimental property tax reforms in Shanghai and Chongqing to more regions.
Chen Jie, a researcher from Shanghai-based Fudan University said property tax acted as a brake on speculative housing demand, adding that it is hard for the speculators to decide on whether to hold the property with a view to wait for an uncertain appreciation or to cash in to acquire certain profits as soon as possible.
The cabinet asked cities that have imposed restrictions on the housing market to maintain their grip, while other cities in which home prices have soared too fast will be asked by the related provincial governments to introduce timely curbing measures, according to a statement released after the meeting.
Buoyant prices in some cities are mostly due to China's urbanization and shortages in home supply will likely persist in these places in the near term, the statement said.
China's urban population outnumbered that of rural areas at the end of last year, an increase that is expected to give momentum to urban property markets.
The State Council also pledged to ensure land supplies for housing projects this year, saying that land supplies for home construction should not be lower than the average for the past five years.
Meanwhile, the government will also accelerate construction on government-subsidized housing. The government aims to finish construction on 4.7 million affordable housing units and start construction on another 6.3 million units.