Tightening Regulation

Three Chinese cities have suspended commercial housing sales to entities registered as companies or institutions, in a further effort to halt speculative purchases.

The Hangzhou Housing Security and Management Bureau announced on June 26 that enterprises and institutions will no longer be qualified to buy houses in areas with home-purchase restrictions.

The move by the capital city of east China’s Zhejiang Province comes after similar policies were issued by Changsha on June 25 and Xi’an on June 24.

As the effects of housing controls wane over time, speculative demand increases and so local governments will strengthen their efforts to clamp down on speculation before a long-term mechanism is established, experts said.

Zhang Dawei, chief analyst with Centaline Property, told Economic InformationDaily that buying commercial houses under the name of a company is a common way to bypass restrictions. Compared with the non-resale time span set for individual buyers, institutional buyers can resell houses through equity deals without having to worry about the time limit.

Meanwhile, the newspaper