China’s Local Governments Loosen Property Market Controls in Wake of Coronavirus
Local governments around China have issued property market support policies in the wake of the spread of the coronavirus, dialling back on the market controls imposed since the start of 2017.
On 12 February a slew of China’s local governments issued property market support policies, including Wuxi, Xi’an and Nanchang.
To date at least ten province and municipal governments around China have recently introduced new policies in relation to local property markets.
On 12 February the Jiangsu-province city of Wuxi issued the “Policy Opinions on Responding to the Novel Coronavirus Infectious Pneumonia, Supporting Enterprises in Jointly Passing a Difficult Period and Ensuring the Stable Operation of the Economy” (关于应对新型冠状病毒感染的肺炎疫情支持企业共渡难关保障经济平稳运行的政策意见).
The Opinions provide a deferral period of up to three months for tax applications and tax payments made by enterprises in the real estate sector.
They also loosen key regulatory quotas, including allowing pre-sales to commence once 25% of the investment quota is made.
The Shaanxi-province capital of Xi’an issued similar measures on the same date, which include allowing the handling of immovable property registration certificates once 50% of the land sum is paid, and reducing the land deposit to 20%.
Prior to this nearly ten cities including Chengde, Jiaxing and Tianjin issued policies in relation to the housing market, including fiscal support policies, adjustments to land payment methods and terms, and streamlining of review and approval procedures.
“The basic theme that ‘housings are for occupation, not speculation,’ will not change,” said Fan Ziying (范子英), vice-head of the China Public Financial Research Institute at the Shanghai University of Finance and Economics, to Diyi Caijing.
“However, the focus will gradually shift from ‘not speculating’ to the role of ‘occupation,’ including renovation demand, and continuing to drive economic growth.”
Fan said that the Chinese government will continue to use investment in areas including infrastructure, living standards, medical treatment and the Internet as medium and long-term drivers of stable economic growth.