Wednesday September 7, 2011

China to curb prices in small cities

BEIJING: China’s measures to control its property market are at a critical stage and the nation needs to focus efforts on curbing housing price gains in second and third-tier cities, Chinese Premier Wen Jiabao said in an essay.

“We must unswervingly curb irrational housing demand, continue to strictly implement differential housing loans, tax policies and restriction on purchases,” Wen wrote in Qiushi magazine, a publication of the ruling Communist Party.

China has expanded its property control measures this year, raising downpayment requirements and mortgage rates to ease gains in home prices. The government said last month it would rein in residential prices in smaller cities.

“At the same time, we need to focus on suppressing overly rapid price gains in second and third-tier cities to promote a return to reasonable house prices,” Wen said in the article, which was posted in full on the magazine’s website recently.

Home prices in the country remained “basically unchanged” in August from the previous month, SouFun Holdings Ltd said in an e-mailed statement. Residential prices in 56 cities rose from July, based on 100 locations tracked by SouFun, with average home prices nationwide climbing to 8,880 yuan (US$1,392) per sq m, the nation’s biggest real-estate website owner said. — Bloomberg

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