Shenzhen among cities easing home-buying curbs

Major Chinese cities of Shanghai, Guangzhou and Shenzhen have adjusted their real estate policies, with a slew of measures unveiled to boost local property markets.

Visitors pack a showroom in Shenzhen, where models of a property development are on display. Shenzhen Evening News

Shenzhen

In Shenzhen, the policy update, jointly issued yesterday by the Shenzhen Municipal Housing and Construction Bureau, the State Administration of Taxation Shenzhen Tax Service, the Shenzhen branch of the People’s Bank of China, and the Shenzhen Regulatory Bureau of the National Administration of Financial Regulation, introduces a more relaxed approach to housing purchases for both residents with a residency permit, or hukou, and non-hukou residents.

Under the new rules, hukou families in Shenzhen can now buy up to two homes, while single young residents are limited to one home. Non-hukou families and single adults are restricted to buying only one home in the city.

On top of these restrictions, Shenzhen hukou families and single young people are allowed to buy an extra home in the districts of Yantian, Bao’an (excluding Xin'an and Xixiang subdistricts), Longgang, Longhua, Pingshan, Guangming, and Dapeng New Area.

For non-hukou families and single adults, the criteria for buying properties in the core districts of Futian, Luohu, Nanshan, and Bao’an’s Xin'an and Xixiang subdistricts have been simplified. They now only need to provide proof of one year of continuous income tax or social insurance payments in Shenzhen, a reduction from the previous requirement of three years. Meanwhile, in the outer districts, non-hukou buyers no longer need to submit any proof of income tax or social insurance payments. Those non-hukou families with two or more underage children can buy an additional home on top of the existing limits.

These changes signify a further relaxation of the stringent purchase restrictions previously imposed on non-hukou buyers, effectively removing purchase limits in outer districts and reducing the social insurance requirement in core areas from three years to one.

Moreover, Shenzhen has lifted the resale restrictions on both commercial and residential properties. Residential properties can now be sold immediately after obtaining the property rights registration certificate, whereas previously, owners had to wait three years. Similarly, the holding period for commercial apartments has been shortened from five years to no restriction.

To further stimulate the housing market, Shenzhen has also reduced the holding period for the value-added tax exemption on housing transfers from five years to two years. Down payment requirements for commercial housing loans have also been adjusted, with the minimum down payment ratio for first-time buyers reduced to 15% and for second-time buyers to 20%.

The new guidelines also emphasise market-oriented pricing, allowing developers to set property prices independently, which are then submitted to the market regulator and submitted to the district-level housing departments for record. Projects involving residential land acquired through bidding, auction or listing will adhere to previous agreements.

In addition, Shenzhen has announced plans to pilot a ready-to-sale property system by gradually increasing the proportion of new supply land designated for ready-to-sale housing to promote sales system reform. The city will use its real estate financing coordination mechanism to ensure fair treatment for real estate enterprises of all ownership types, addressing their reasonable financing needs.

Guangzhou and Shanghai

Guangzhou has also lifted restrictions on buying properties, a new step for the first-tier city to further optimize its real estate market.

Starting today, qualifications for purchasing a home will no longer be reviewed and there will be no restrictions on the number of homes purchased by families and single individuals with or without local household registration in the city, according to a circular issued by the general office of the municipal government on Sunday night.

In Shanghai, the minimum down payment ratio for individual commercial mortgages will be reduced from 20% to 15% for first-home purchases, and from 35% to 25% for second homes, according to a circular issued Sunday.

Commercial banks will be guided to lower existing mortgage rates to further reduce mortgage interest expenditures for home buyers. Restrictions on home-buying qualifications will be further relaxed in specific locations of Shanghai. The new measures will take effect Tuesday.

The latest measures follow a Thursday meeting of the Political Bureau of the Communist Party of China Central Committee, which underlined the need for efforts to reverse the real estate market downturn and stabilize the market. (Xinhua)