Housing prices in China, which have seen a significant surge in recent years, appear to be stabilizing in the wake of new measures aimed at curbing speculation and encouraging affordable housing. Although prices continue to increase in the larger cities, these increases are becoming slower and easier to manage.
The government of China has been working hard to tackle housing prices and contain the speculation that have been driving prices up. As such, there have been some new policies implemented to ensure that living costs don’t become so sky-high that it becomes cost prohibitive for ordinary individuals and families to purchase homes.
These new measures appear to be having a positive impact on curbing housing prices and helping to stabilize the market.
What is the Situation in China?
Although China remains one of the world’s most populated countries, its housing prices have been on the rise for a number of years. This surge can be attributed to both population growth, increasing living standards and speculation in the real estate market. As such, China’s larger cities have seen a surge in property values that are often times out of reach for many who seek to purchase a home.
Recent Policies Aimed at Curbing Housing Prices
China’s government has implemented several policies in order to help curb housing prices. These policies are designed to encourage affordable housing, discourage speculation and promote economic stability.
Here are some of the key measures that have been put in place:
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Taxation on Home Flips: Investors and developers who purchase and then sell a home within five years are now subject to taxation on any gains made.
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Restrictions on Second Home Purchases: In an effort to contain rising prices, homebuyers are now required to pay a hefty 50% deposit on second home purchases.
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Crackdown on Speculation: Restrictions have also been placed on developers and investors who are suspected of hoarding land and pushing up prices.
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Promotion of Affordable Housing: The government is offering loans and other incentives to encourage the construction of more affordable housing.
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Strengthening of Property Management Regulations: Rules have been tightened to ensure that housing bubbles do not reoccur.
China’s Housing Prices Show Signs of Stabilizing
Now that the measures have been in place for some time, China’s housing prices appear to be stabilizing. According to recent reports, property prices in the larger cities are still rising but the rate of increase is becoming slower and more manageable.
In addition, there is evidence that the measures are having a positive impact on helping the average person become a homeowner. For example, the city of Shanghai saw significant growth in the number of first-time homebuyers in 2014 compared with the previous year.
The stabilization of housing prices can be a good indication that China is on the right track to achieving more economic stability.
In conclusion, China’s housing prices are showing signs of stabilizing as a result of the government’s recent measures aimed at curbing speculation and encouraging affordable housing. The measures have certainly helped to control the rate of increase in property prices in the larger cities as well as make it possible for more people to become first-time homebuyers. This stabilization of China’s housing prices is a good indication that the country is on its way to achieving greater economic stability.
