Bei­jing to curb rise in city’s home prices

China Daily (Hong Kong) - - BUSINESS - By HU YUANYUAN huyuanyuan@ chi­nadaily.com.cn

A top Bei­jing of­fi­cial vowed dur­ing the week­end to re­in­force re­stric­tive mea­sures in the cap­i­tal’s real es­tate mar­ket to en­sure steady home prices next year.

His re­marks echoed the Cen­tral Eco­nomic Work Con­fer­ence’s state­ment to curb spec­u­la­tion in real es­tate mar­kets.

“Res­i­den­tial homes have been al­ready over­priced, pil­ing on risks and adding to so­cial anx­i­ety. It chal­lenges the city’s sus­tain­able de­vel­op­ment and sta­bil­ity,” said Guo Jin­long, Party chief of Bei­jing, on Sun­day.

“Very prob­a­bly, Bei­jing will fur­ther raise the thresh­old for im­prove­ment-ori­ented home­buy­ers by in­creas­ing the re­quired down pay­ment and mort­gage rates,” said Guo Yi, mar­ket­ing di­rec­tor of real es­tate con­sul­tancy Ya­hao Real Es­tate Sell­ing & Con­sult­ing So­lu­tion Agency.

On Sept 30, Bei­jing raised the down pay­ment re­quire­ment for first-home buy­ers from 30 to 35 per­cent. For those who have had one apart­ment, and want to buy another one to im­prove their liv­ing space, whether they have paid off the mort­gage for their first home or not, they have to pay a 50 per­cent down pay­ment when mak­ing a new pur­chase.

Ya­hao’s Guo said that to fur­ther tighten the reg­u­la­tions, those who have sold their first home and want to buy a new one may even face a 50 per­cent down pay­ment or an even higher one.

“Such a mea­sure will def­i­nitely lead to a sharp drop in trans­ac­tions and the price of pre-owned homes will also see a slide,” he added.

Prop­erty trans­ac­tions fell 31.7 per­cent in Shen­zhen, 12.2 per­cent in Shang­hai, but still climbed 5.6 per­cent in Bei­jing last month.

“House trad­ing vol­umes in Bei­jing will prob­a­bly de­crease by 20 per­cent at most if Bei­jing raises down pay­ment re­quire­ments or mort­gage in­ter­est,” said Zhang Dawei, chief an­a­lyst with Cen­taline Prop­erty Ltd.

Gao Songya contributed to this story.

Guo Jin­long, Party chief of Bei­jing

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