(ECNS) - More Chinese cities have tightened restrictions on home purchasing by companies amid efforts to further prevent speculation in the real estate sector, Shanghai-based The Paper reported.
On Tuesday, authorities in Hangzhou City, Zhejiang Province, suspended the sale of houses, including commercial housing and second-hand homes, to enterprises after three companies with the same legal representative -- a man surnamed Zhou -- won the competitive draw for houses in a real estate project, according to Qianjiang Evening Post.
When there are too many buyers for one housing project, the developer usually organizes a lottery draw to select the applicants. Many first-tier and second-tier cities, such as Shanghai, Nanjing, Changsha, Chengdu, Wuhan and Xi'an, have adopted the housing purchase lottery system, with Xi’an and Changsha introducing a purchase ban for companies.
Shanghai authorities, including the judicial department, are mulling measures to restrict companies from buying houses, if not a total ban, said an official with the Shanghai Municipal Management Committee of Housing and Urban-Rural Development.
Liu Lu, an associate professor at the Southwestern University of Finance and Economics, said cities adopting the lottery-like registration system for buying homes are facing a population flood and need to address structural shortages of supply in local housing markets.
Chen Lei, a real estate analyst, said that as housing prices continue to rise despite controls, many real estate speculators have purchased houses in the name of companies, which has worsened a fake hot real estate market.
Experts believe that more cities will roll out similar policies to crack down on real estate speculation, the report said.