China’s large cities already have housing price restrictions set to curb inflation. Apparently, though, that’s not enough. Now the government is launching an investigation into “excessive” housing prices in second and third tier cities to determine whether or not they should be subject to the same regulations.
Via Shanghai Daily:
There has been growing concern among the country’s decision makers that home prices have been rising very quickly in some of China’s second- and third-tier cities over the past few months after investors flocked to those less affluent areas where people are still free to buy properties without restriction.
According to data released today from the National Bureau of Statistics, many of those areas saw housing prices rise at rates between 0.5% and 0.6%.
In the meantime, banks are halting all property loans and considering raising the ratio of down payments to up to 50% or 60% of a properties price. Interest rates could move up to 10% to 15%.
Via China Daily:
“You’d better prepare to pay 40 per cent of your home price as down payment, because commercial banks are going to ask more for a property loan,” said Gong Hang, a bank staff in Taiyuan, Shanxi province. “It is only a matter of time.”