Two Chinese mega-cities lift curbs on buying homes to shore up real estate market

Two Chinese mega-cities, Hangzhou in East China's Zhejiang Province and Xi'an in Northwest China's Shaanxi Province, said on Thursday they would lift all home purchase restrictions to shore up the local real estate market and boost market confidence. It follows similar moves recently in other big cities like Chengdu, Shenzhen and Beijing.

The city housing authority in Hangzhou said in a notice that it will no longer review the qualifications of homebuyers, with the restrictions on residential property purchases having lasted for eight years, the Xinhua News Agency reported. This comes after Hangzhou announced last October it would narrow the scope of home purchase restrictions to four core districts, including Shangcheng district. It also announced the removal of all restrictions on home purchases starting from May 9.

Xi'an, the capital city of Shaanxi Province, has announced similar measures. The local authorities said they will remove all restrictions on residential property purchases and will no longer review the qualifications of homebuyers for both new and second-hand homes.

As of Thursday, a total of 35 Chinese cities have relaxed restrictions on home purchases, while 24 have completely scrapped all curbs on residential property purchases. In addition, more than 160 cities have adopted home-buying loosening policies, CCTV News reported.

These measures will encourage other cities to follow suit and will boost market confidence, Chinese analysts said.

More regions and cities in China will start a new wave of policy relaxation, along with promotions by developers, Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, said on Thursday.

Chinese authorities have been ramping up measures to prop up the real estate sector recently. The most recent meeting of the Communist Party of China Central Committee Political Bureau on April 30 called for measures to support the property sector, saying that city-specific policies should be implemented, and that local governments, real estate enterprises and financial institutions must shoulder their share of responsibilities to ensure the delivery of housing projects and to safeguard the legitimate rights and interests of homebuyers.

Combining the new changes in the relationship between supply and demand in the real estate market and people's aspirations for high-quality housing, it is imperative to conduct research on policies and measures to reduce housing inventory and improve the quality of new housing in a coordinated manner. New modes for the development of the real estate sector will be fostered to boost the sector's high-quality development, according to Xinhua.