Trade & Investment

Xiamen abolishes house purchase restrictions on Jan 16

Updated: 2015-01-22
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According to the old policy, Xiamen families could possess a maximum of two houses, and residents without a local hukou, (household registration), could purchase only one
   
Siming and Huli districts in Xiamen abolished house purchase restrictions on Jan 16, leaving only 5 Chinese cities - Beijing, Shanghai, Guangzhou, Shenzhen and Sanya still having the policy.

According to the old policy, Xiamen families could possess a maximum of two houses, and residents without a local hukou, (household registration), could purchase only one,

Xiamen relaxed the policy last August allowing people to buy houses in four suburban districts without restriction. But buyers have been subject to restrictions when buying residential houses of less than 144 sq m in Huli and Siming districts.

The Jan 16 policy puts an end to that.

The Xiamen real estate market was stable compared with other Chinese big cities in 2014, though the selling area of commercial housing from January to November was 4.44 million square meters, declining by 39 percent year on year, 2.88 million square meters of which was residential building, falling by 43 percent.

Xiamen now has an exploitable area of 8.3 million square meters for residential building, and has 3.18 million square meters on the market, which is sufficient to meet demand in 2015. Therefore, it is unlikely that there will be a surging housing price due to the imbalance between supply and demand.

Different customers have different attitudes towards the policy. Some say that the housing price in Xiamen is too high to afford while others have been ready to purchase their third house.

"We hope the new policy can help tighten up the real estate intermediary industry in Xiamen”, said Guo Zhongzong, vice president of the Real Estate Intermediary Association of Xiamen. There are more than 2,000 real estate intermediary agencies in Xiamen, some of which had zero deals in the bleakest months of 2014 and some of which shut down.

Guo said houses with an area of less than 144 square meters in Huli and Siming districts are targets for many investors, who could not buy them owing to the old restriction policy. Now, the cancellation of purchase limitations is expected to add 20 to 30 percent of purchasing demands.

"After a sequential rise for 28 months, the house price in Xiamen has exceeded the purchasing power of most residents. Potential buyers are apt to wait for a better purchasing period,” according to Kong Jun, general manager of Xiamen Division of Centraline Group.

Although the purchasing restriction has been cancelled, the loan policy still lags behind. Potential housing buyers are still waiting for more favorable policies to cut down the housing price, according to Cao Xiangjun, an associate professor in the Schools of Finance and Economics of Jimei University. 
  
SOURCE:
China Daily
  
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