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      Second-tier cities may loosen property curbs: report

      2014-04-03 13:46 Global Times Web Editor: qindexing
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      Local governments in several second-tier cities are considering easing restrictions on the housing sector in a bid to arrest the slide in local real estate markets, Shanghai Securities News said Wednesday, citing industry insiders.

      The city government of Hangzhou, capital of East China's Zhejiang Pro-vince, and the government of Changsha, capital of Central China's Hunan Province, held meetings with major developers around a week ago to discuss ways to boost their slowing real estate markets, the report said.

      At the meetings, the two local governments told the developers they were considering a series of policies to stabilize the real estate market, including easing restrictions on housing purchases as well as allowing easier access to bank loans for second-home buyers, the report said.

      The city government of Wenzhou, Zhejiang Province is also making moves to boost the local property market, and a proposal has been filed with the Zhejiang provincial government, the Beijing-based Economic Observer newspaper reported Friday.

      "In some lower-tier cities, keeping housing prices from dropping too much has become the new focus for regulatory policies," Yang Shaofeng, general manager of Beijing Lianda Sifang Real Estate Consultancy, told the Global Times Wednesday.

      In February, housing prices in Wenzhou declined for the 31st consecutive month.

      In February, the average price of new homes in the city fell by 4.1 percent year-on-year, according to data from the National Bureau of Statistics.

      Though property prices in Hangzhou and Changsha are still rising, there have been media reports recently saying that many housing projects in the two cities are offering homes at a discount and that transactions are sluggish anyway.

      Efforts to reach the three local governments failed on Wednesday.

      The central government started to impose administrative measures in an effort to cool the overheating housing sector in April 2010. So far, over 40 -cities around the country have introduced purchasing restrictions.

      However, the central government has changed its tone recently, regarding regulation of the real estate sector. During the two sessions in March, Vice Minister of Housing and Urban-Rural Development Qi Ji told the media that the government will adopt different measures for regulating the real estate market in different places.

      In cities that have seen fast price increases, the regulatory measures will focus on increasing supply, while in cities where there is oversupply, the policy will lean toward reducing land supply and guaranteeing reasonable sales, Qi said.

      Yin Kunhua, a professor of real estate at the Shanghai University of Finance and Economics, noted that policies will be more adapted toward the market, and it would not be a wise solution for the government to use unified policies for the whole country.

      "In cities like Wenzhou where oversupply is a severe problem, the local governments should figure out ways to boost purchases," Yin told the Global Times Wednesday.

      Experts noted that the real estate sector plays a vital role in the development of local economies, so local -governments are motivated to ease curbs on the real estate sector to guarantee economic growth.

      "More cities that are facing declining real estate markets will also try to ease restrictions," Yang said.

      China's real estate sector has already shown signs of cooling. In March, 37 cities among the 100 major cities monitored by the China Index Academy reported month-on-month falls in housing prices.

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