From Forbes comes an interesting story on the results of China’s recently announced new property curbs:
China is determined to poke holes in its housing bubble. Nowhere is this attempt more forceful than in Shanghai, where the government introduced its first-ever property tax last year.
Something else is happening now in China housing. Investors who buy homes as a store of value, rather than as a place to sleep at night, are rushing to their realtors before the government implements a 20% capital gains tax on housing sales. Beijing introduced the new rule on March 1, but no one knows when it will go into effect.
“The new measures will have a significant impact on both demand and supply in the existing home market,” Lina Wong, a managing director at Colliers International, was quoted saying in Shanghai DailyTuesday.
…The latest ruling has sellers wanting out before it kicks in. The number of homes on the market rose 30% in Pudong New Area, a high-end waterfront district in Shanghai.
…For the first 10 days of March, 412,000 square meters of new residential property were sold across Shanghai, China’s most expensive city. That’s been a year-on-year sales increase of 78.4%, according to Century 21 China Real Estate.
…In Beijing, some 9,400 homes were sold last week, up a mega 279.5% from the same period last year, the Beijing Municipal Commission said today.
Pre-owned home sales almost tripled in Beijing last week, following the latest moves by the State Council to reign in this property market. On a monthly basis, the figures represented a 140.5% increase on the previous week.
…A survey by SouFun Holdings Ltd, a real estate-focused website, said about one-third of potential home buyers had changed their home-purchase plans as a result of the tax.
Chen Li, a company executive living in Beijing’s Tiantongyuan area, was quoted saying in China Daily: “I did not plan to sell my apartment before the launch of the 20 percent taxation policy. But considering I may have to pay around 200,000 yuan ($32,100) tax once the policy is in place, I’d better make a deal right now.”
