Changzhou latest to lift home resale restrictions
The affluent eastern city is trying to stimulate the market by allowing homeowners to sell houses faster
Men work at a residential building construction site in Beijing, China, July 15, 2022. (Photo by Reuters)
Changzhou, a wealthy city in China’s eastern province of Jiangsu, has eased restrictions on residential resale and has joined several Tier 2 cities in an effort to ease curbs to boost demand and breathe life into the battered market.
The change means owners can now put their home on the market as soon as they receive their property title certificate, rather than having to wait two years after purchase, according to a statement from the city’s housing department on Tuesday.
Homeowners usually have to wait between three and six months for the certificate, reducing the time limit by at least 18 months in most cases.
The measure came into effect on February 15, the statement said.
According to the city government’s official website, Changzhou’s gross domestic product (GDP) per capita reached 178,243 yuan (US$25,711) in 2022, twice the average in mainland China.
His move to boost buying suggests that even China’s wealthier cities are keen to boost their property markets to prop up economic growth.
Restrictions on home resale have been among the key tools regulators have used to curb speculation in the country’s real estate sector in a bid to stem skyrocketing prices in recent years.
They have been used by Chinese authorities since 2017, along with other measures such as home loan caps and tougher home-buying restrictions, to stem the housing bubble sweeping the country.
That all changed in November when local governments rolled out supportive measures to bail out the struggling real estate sector, from making financing easier for developers to cutting mortgage rates to boost sales.
Dozens of local governments have eased home buying restrictions in recent months to boost sales.
In the latest case, the government of Changsha in central Hunan province eased restrictions on resale in five districts in the city, according to a report by state-owned Chinese media company The Paper on Monday.
Under the revised rule, Changsha residents who bought homes in five of the seven restricted regions are now allowed to sell their homes four years after purchase, while previously the four-year period began only after receiving their title deeds.
The Huizhou and Yangzhou governments also eased restrictions on home resale last month.
The easing of restrictions is necessary to facilitate the “stable and healthy development” of the real estate market, Ni Hong, Minister of Housing and Urban-Rural Development, said during a media interview at the Two Sessions political meeting in Beijing on Tuesday .
Wang Tao, chief China economist at UBS, said in an online webinar on Tuesday that mainland China’s property sales will see a slight year-on-year decline, although sales towards the end of 2023 are down about 10-20 year-on-year % could rise period a year earlier.
UBS’s recent decision to raise its forecast for China’s economic growth to 5.4% from 4.9% is partly due to a faster-than-expected recovery in the real estate market, according to Wang.