Shanghai loosens home purchase regulations to 'save' real estate market

Shanghai, mainland China's commercial and financial hub, further loosened home-buying policies, following Beijing in its efforts to revive the country's sluggish property market.

Unfinished urban area of ​​China Evergrande Group in the suburbs of Shijiazhuang city, Hebei province, China - Photo: REUTERS

Shanghai has announced adjustments to its real estate policy, removing restrictions on the number of homes eligible families can buy in suburban areas of the city, according to the South China Morning Post on August 25.

This new policy allows local residents to own an unlimited number of apartments, instead of the previous maximum of two.

The city’s housing authority said single people would be eligible for the same relaxations as eligible families, with the changes expected to take effect on August 26.

Mortgage rates for second-home buyers will be cut to 3.05 percent per year, from 3.35 percent previously, matching those for first-time home buyers.

By the end of 2024, Shanghai lifted restrictions on outsiders buying homes in the city.

In addition, people from other parts of China only need to pay taxes to local governments for 12 months to be eligible to buy houses in Shanghai, instead of the previous three-year requirement.

Shanghai's incentive measures are "in line with expectations," said Zhu Xinhai, a sales manager at city-based real estate brokerage 5i5j.

However, he added that these local policies "may not be enough to spark strong buying demand, given pessimism about the economy and wage growth".

The policy adjustment is aimed at meeting people's huge housing needs and improving living conditions, while promoting the stable and healthy growth of the local real estate market, according to a statement from the Shanghai government.

China's property market has been in a severe slump for more than four years, with prices, sales, new investment and construction starts falling, putting pressure on economic growth.

Shanghai's market support measures come after new home prices in 70 cities fell 2.8% year-on-year in July, according to data from Trading Economics .

In the existing home market, prices have fallen for more than two consecutive years, with a 5.9% decline in July compared to the same period in 2024, following a 6.1% decline in June.

Before Shanghai, on August 8, the Beijing city government initiated a loosening of housing policies to stimulate people's demand, a move to support the struggling real estate sector.

Both locals and outsiders are now free to buy new and used homes outside Ring Road 5, the main highway that encircles the suburbs.

Central and local governments across the country have rolled out similar stimulus measures, including reducing mortgage rates and deposits, to encourage housing transactions.

New home sales in China may fall just 7% this year, an improvement from its previous forecast of a 15% drop, Fitch Ratings reported earlier this month.

HA DAO

Source: https://tuoitre.vn/thuong-hai-noi-long-quy-dinh-mua-nha-nham-cuu-thi-truong-bat-dong-san-20250827165653533.htm