New rules vitalize housing hopes

2024-01-16 10:01:04China Daily Editor : Li Yan ECNS App Download

Potential homebuyers check models of housing projects at a real estate agency in Shanghai. (WANG RONGJIANG/FOR CHINA DAILY)

Shanghai's easing of some rules on Saturday to enable singles to own homes in two districts more easily will boost rational demand in the city's outskirts, local property experts said on Monday.

The move also signals that more restrictions will likely be lifted in the future, they said.

On Saturday, Shanghai's Qingpu and Fengxian districts announced they will reduce homebuying restrictions on nonlocal talent.

According to the latest policies, non-local families and single buyers who have been working in the two districts, paying local taxes for the last three years, and do not own any residential property in Shanghai, will now be eligible to buy an apartment.

The previous requirement was that only families that had been paying local taxes for at least five years were eligible to buy homes in Shanghai.

"Targeting a specific group of homebuyers, the new measure will mainly benefit non-local talent, and singles in particular," said Guan Rongxue, a senior analyst with the Zhuge Real Estate Data Research Center.

Guan said he believes the policy optimization will help the market to sell residential properties unsold so far in certain parts of the city and increase the attractiveness of Shanghai's suburban areas among professionals.

Zhang Wenjing, general manager of data in Shanghai with the China Index Academy, said the new policies will encourage professionals to settle down in the two districts, which will accelerate local development.

Zhang said new home transactions shrank 11 percent year-on-year in Qingpu last year, and contracted more than 24 percent in Fengxian.

Prior to the two districts' policy adjustments, Shanghai's Jinshan district, Beijing's Fangshan district and Guangzhou's Huangpu district had made changes to their home purchase restrictions, according to Li Yujia, chief researcher at the Guangdong Planning Institute's residential policy research center.

"All these areas are emerging industrial regions where real estate has played an important role in the financing of infrastructural facilities, attracting both investment and talent. Their policy changes will now help stabilize the housing market and create opportunities for local governments' land transactions," said Li.

Li also said he believes areas beyond downtown in more first-tier cities will likely ease their homebuying restrictions.

"Many of the suburban areas in hot spot cities, including first-tier cities, are becoming new cities of industries where large populations can settle down, and property plays a big role in local development."

Monday marked the completion of the first month of new housing policies in China's two biggest cities. Beijing and Shanghai had announced adjustments to their home purchase policies on Dec 14.

Their measures ranged from redefining ordinary housing to lowering the down payment ratio, which helped reduce costs for homebuyers.

In the past month, local homebuyers' willingness to buy property in Beijing and Shanghai has improved, boosting market sentiment, said Chen Wenjing, director of research with the China Index Academy.

Qingpu and Fengxian districts have raised market expectations of further policy optimization in Beijing and Shanghai, which would help stabilize the local property market and deepen recovery in coming months, Chen said.

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