More Chinese cities may be allowed to relax their home purchase restrictions amid mounting fears for a hard landing in the nation’s property sector, Southern Weekly reported Thursday.
Local governments will be given flexibility to adjust their home purchase policies, the report said, citing several sources from the Ministry of Housing and Urban-rural Development. Cities with high inventory levels will be granted more leeway, although the ministry is unlikely to issue an official notice to that effect, the sources said.
The ministry is not likely to relax the grip on Beijing, Shanghai, Shenzhen and Guangzhou anytime soon, despite some signs of a property slowdown in these first-tier cities, the report said.
Jing Fei, who bought his first apartment in Beijing, was recently told that his mortgage has been approved after waiting for four months, the report said.
The case is quite common across the country as the new leadership is taking a more hands-off approach in managing the real estate market, market observers said.
Local governments have strong incentives to loosen property restrictions in view of their heavy reliance on land sales revenue.
In 13 Chinese cities, including Hangzhou, Foshan and Nanjing, land transaction fees account for over 80 percent of the local government’s fiscal revenue, Yangcheng Evening News reported on Monday, citing a study by Tospur Real Estate Consulting.
Cities like Nanning, Wuxi, Tianjin and Xiaoshan district in Hangzhou have unveiled measures to ease property curbs.
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