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Hohhot may lift home purchase limits

2014-06-26 08:26 Global Times Web Editor: Qin Dexing

More provinces to follow suit

The local housing authority in Hohhot, capital city of North China's Inner Mongolia Autonomous Region, said in a notice on its website early Wednesday that it has canceled its home purchase restriction policies, raising expectations that more Chinese cities may possibly follow suit, although the authority deleted the notice later.

According to Hohhot's policies on home purchase restriction implemented since April 2011, local residents with Hohhot hukou, or household registration permit, could buy a maximum of two units of apartments per family.

The residents of Hohhot will not be required to offer documentary evidence of units of apartments owned by a family when they plan to buy apartments, according to the notice published on the website of the Hohhot real estate development and supervision department.

That means Hohhot will become the first city to completely withdraw its home purchase restriction policies, which have been implemented in at least 40 major Chinese cities since 2011, as part of the central government's efforts to curb property speculation.

But late on Wednesday, the notice was deleted without official explanation. Chinese news portal NetEase quoted an official from the department as saying that they "deleted the notice because of two wrong words, and will repost very soon."

The department could not be reached for comment by press time.

"Home inventories in Hohhot rank top among major Chinese cities," Yang Hongxu, deputy director of E-house China R&D Institute based in Shanghai, told the Global Times on Wednesday, citing data form his research institute.

Yang thought Hohhot's move was "brave" and might not be opposed by the central government, and that more second- and third-tier cities would possibly follow suit.

More than a dozen cities including Shenyang in Northeast China, and Hangzhou and Ningbo in East China have reportedly loosened their home purchase restrictions in the first half of this year, although the local governments have not formally confirmed the measures, according to local media reports.

"Inventories for apartments far from downtown areas in second- and third-tier cities are very high," Chen Baocun, director of the real estate department at Beijing-based Asian-Pacific City Research Institute, told the Global Times on Wednesday.

Chen agreed with Yang that more cities will cancel their home purchase limits because of the central government's calls for letting the market play a decisive role in the country's economic reform.

Premier Li Keqiang said in his first annual government work report during the opening session of the National People's Congress in March that the governments should adopt different policies to control the real estate market in different cities, which Chen said "is a strong support for more cities taking their own measures to regulate the property market."

But analysts said the cancellation of home purchase limits in some second- and third-tier cities is unlikely to reverse the downward trend in their property market.

"The home supplies in some second- and third-tier cities are too large after four to five years of fast development," Liu Yuan, a senior research manager with Shanghai-based Centaline, told the Global Times Wednesday.

In the first five months of this year, both home sales area and sales value witnessed contraction, down 7.8 percent and 8.5 percent year-on-year, respectively, according to data from the National Bureau of Statistics.

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