China imposes tougher measures on housing prices

World Today

China is working harder than ever to keep home prices under control. This month, 16 Chinese cities have imposed new measures to restrict home sales.

CGTN’s Ning Hong filed this report.

China imposes tougher measures on housing prices

China imposes tougher measures on housing prices

China is working harder than ever to keep home prices under control. This month, 16 Chinese cities have imposed new measures to restrict home sales.
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On Friday, the Beijing City government announced new measures on the real estate market, which took effect the day after. It’s the toughest of its kind the Chinese capital has seen to date. It includes raising the minimum down payment for second homes to 60 percent. Such measures aim to cool the overheating market, which according to one of China’s largest online real estate agencies, is starting to burn up once more.

“Signs of overheating started to re-emerge in many cities in February. During the first two weeks of March, the second hand housing market saw over nine-thousand sales in Beijing. If that trend continues, the number could breach 20-thousand by the end of the month. Prices have also begun to rise again. It’s a necessary and timely policy,” said Hu Jingui, Vice President of Real Estate Service B.A. & 515J Group.

Housing prices in the Chinese capital are reaching record heights. Many new deals are made at a price of over a hundred thousand yuan per square meter.

Be it a CEO or a fresh university graduate – locking down a home and a place to live in Beijing is tough to come by, with housing prices soaring higher than ever. An apartment in the downtown area can now cost over ten million yuan, 200 times greater than the average annual income in Beijing. And, it’s this very price tag that’s deterring many people from settling down in the nation’s capital.

Authorities in China are sending a clear message: This bubble must be popped. The property market should provide homes for people, not investment vehicles for the rich.

More than a dozen Chinese cities issued new housing measures in February. Smaller cities are joining, many of them surrounding the major economic hubs of Beijing and Shanghai.

Long-term measures are also now being drawn up.

“Long-term mechanisms such as reforms in fiscal policy and taxation, the financial system, and investments could eventually replace existing measures,” Hu Jinghui said.

Some cities such as Beijing are suffering from high prices. But other cities in China have more homes than their residents can fill. More policies will come in the future to address different challenges, but for now, the stability of prices is everyone’s main concern.