One-new-house policy hits Shanghai
Under the new regulations, families won't be able to buy more than one extra home in Shanghai if they already own one.What’s hotter than this summer's temperatures? The Shanghai real estate market -- or it was until last week.
On October 7, Shanghai joined Beijing in implementing measures to cool the city’s rising real estate prices with a host of new policies hoping to curb market speculation.
The most recent batch of regulations from the Shanghai Municipal Housing Authority contains 12 measures to curb speculative investment in the Shanghai real estate market.
The most talked about is that those looking to buy in the Shanghai market (residents and non-residents) now can have no more than one new home in Shanghai "for a certain period of time." The exact time was not included in the release.
This policy has been in place since May 1, 2010 in Beijing although the effects have been much debated.
"Speculation is rampant in Shanghai's housing market. This new regulation will prove to be a timely and effective means of cooling down the housing market," says Chen Jie, a professor in the school of management at Fudan University who specializes in property research, to China Daily.
"The 'one-home' purchase restriction, in particular, will likely affect the market in terms of both volume and price and hopefully, we will see a cooled-down market in the fourth quarter," agrees Ma Ji, a research manager with Shanghai Centaline Property Consultants Ltd, operator of the city's largest real estate chain to Shanghai Daily.
Additionally, the city has limited mortgage availability for home buyers, and is easing restrictions that limit the movement of home owners who had to relocate due to urban redevelopment. Real estate developers will also face stricter value-added taxes on residential projects.
The much-anticipated (and hotly debated) general property tax was not one of the new measures announced. However, the city government says it is prepared to introduce such a measure.
Some recent reports have speculated the new property tax would be between 0.3 percent and 0.4 percent of a home's market value.
