After Beijing’s property prices were slammed post-new regulations, all eyes are on Shanghai.
China Daily reports that ‘industry insiders’ expect new property regulations to be announced by the Shanghai municipal government within two weeks.
“A meeting will be held by the Shanghai municipal housing support and building administration bureau on Friday, and the main topic for discussion would be detailed regulations for the property sector,” said Sun Lijian, a professor with Fudan University and an adviser to the local government.
On April 16, the State Council rolled out a series of measures to curb the domestic housing market amid concerns over asset bubbles. These measures include a 30 per cent down payment for first time buyers for houses larger than 90 square meters, 50 per cent down payment and lifting mortgage interest rate for second home buyers. The government has also imposed a temporary ban on mortgage applications for third or above home buys and cross-city purchases.
Shanghai will be the third region after Beijing and Shenzhen to have rules governing property buys, said Sun.
Shanghai Securities News reported that property owners could be hit with annual taxes as high as 8% of the market value of their properties.
Thus threat of higher property-related taxes and restrictions on purchases may have already started to bite. New apartment sales fell 43.7% year over year in April according to China Real Estate Index System Shanghai. The secondary market has seen lower volume as well.
Next comes the likely price drop, as Beijing experienced, which could already happening.