Rumor Mill Continues: Maybe 10 Cities Cannot Ease Buying Restrictions

For the record, I don't think easing buying restrictions will do much to affect the real estate market directly, but it clearly has affected the stock market—property stocks jumped last week when it was first reported that buying restrictions could be eased. As the article below notes, and I covered in Ministry of Housing Wants The Market to Regulate Housing; Official Tells Government Not to Interrupt Market Forces, there's been no confirmation of this rumor from the Ministry of Housing. The public comments by officials relayed second-hand by meeting participants (at closed forums with local government officials and developers)indicate that the Ministry of Housing doesn't want to see intervention in the real estate market, but that cities may be able to ease restrictions if they are willing to take responsibility. Whether this is official policy or not is unclear, but at least it conforms to public comments made by the leadership.

Now the latest rumors are that cities can ease buying restrictions, but that at least 10 cities are not allowed, adding Xiamen and Nanjing to the list. This is not an "official" rumor though, it is based on Centaline analysis of property markets.

媒体称至少10个城市不能放松限购 厦门等地在列
Recently, the Ministry of Housing who confirmed that "north of Guangzhou-Shenzhen, the Ministry of Housing will allow for the purchase of local policy adjustments" rumors, has aroused concern.

The rumor has not been confirmed by authorities. Ministry of Housing has not responded publicly to this report.

In a number of "First Financial Daily" interview with the industry view, the two-way regulation simply by second and third tier cities and divided, does not meet the actual requirements of the regulation and classification of the property market.

Xinhua News Agency issued a document yesterday, said: "Just over a year ago, the goal is to allow regulation of real estate prices back to a reasonable range, but when prices really began to turn down, the local government could not 'calm' the face of low prices. market, FMCG stocks, has now started to become a lot of ways to develop business arm to survive in the market is finally returning to the track when it is established, the ups and downs for change, policy makers should maintain some basic powers of concentration. "

At least 10 cities can not relax

Started in 2010 the purchase of its policies, there were 45 cities in the implementation of the property purchase policies. Under the existing property structure, which the city can not relax the restriction?

At least, in the north of Guangzhou-Shenzhen four first-tier cities, such as Xiamen , Nanjing and other cities rose faster still currently too early to talk about the purchase of deregulation.

"There are at least ten or so." Centaline Dawei, chief market analyst told the "Financial Times."

For example, April 70 cities housing sales price changes in the situation on the 18th National Bureau of Statistics released showed the highest increase in new residential Xiamen and Nanjing, up 0.4%. Among them, Xiamen has been since the fourth consecutive month this year to lead the country. Published in accordance with the middle finger hospital hundred cities house price index in April, the city in April prices of 19,495 yuan / square meter, still higher than the first-tier cities of Guangzhou.

"Now there are some real estate outside Xiamen Island to engage in promotional activities, but did not like Hangzhou, as there are substantial price cuts. "Xiamen World Union Properties [ 4.02% funding research report ] told a reporter, too little supply in Xiamen, the island has been basically no land, the island is also the land came out, everyone desperately to grab, so now Xiamen supply is still tight.

According to public material, 2013 Xiamen land supply plan is expected to sell 62 plots. Finally, the actual transfer of land 48, where residential construction area of ​​1,361,600 square meters only, 1/3 less than the original plan. From 2014 land supply plan, the proposed transfer of 26 residential plots with a total area of ​​about 5,000,000 square meters. Even if all of this year's land supply plan implemented, coupled with the 2013 Yishoufang salable residential area, the most they can meet the market demand for the year.

Xiamen Municipal CPPCC members, Real Estate Institute of Jimei University Liyou Hua told the "Financial Times", under the current property market situation in Xiamen, absolutely no need for the purchase of policies and restrictions, will not allow the upper Xiamen relaxed. Instead, continue to strictly implement Xiamen in the purchase of the regulation also should increase residential land supply to meet market demand, to make prices more stable.

He said the prices of other big central city of Fuzhou, Fujian is also relatively high, Fuzhou, in addition to some decline in sales of large size, the overall supply and demand ratio is not much problem, so there is no point to save the city.

Nanjing is also somewhat similar situation, in March and April of this year, Nanjing and Xiamen as the ring than gains, leading the country.

Vice Minister of the Ministry of Housing, said Qi Ji, during the two sessions this year, this year, China will continue to be classified on the property market regulation, increased ordinary commercial housing supply especially the small and medium size.

Li Youhua analysis, the state proposed by the bi-directional regulation this year, the classification regulation is applied because the city policy. Since each city vary greatly, whether to relax the regulation, to pay attention to the short, medium and long-term risks. Mainly to see the supply and demand ratio of short-term risk, medium risk mainly to see the inventory cycle, mainly to see the long-term risks of land supply. Some of these cities have higher risk indicators, it can be appropriately relaxed.

Of the first-tier cities and second-tier cities such as Xiamen, Nanjing, "if fully relaxed, will continue to rise."

Some places Bypass "relaxation"

This year, some inventory is relatively high city "bailout" sound after another. Centaline research statistics: As of a few days ago, rumors bailout city has more than 10, which clearly landing Policy cities has reached six.

In the case of subsequent real estate market continues to cool, the country is expected to have more than 30 cities have relaxed regulatory expectations and possibilities.

Liyou Hua said that this round of adjustment with two or three years is significantly different. Just place a relaxed before the purchase, it will be stopped immediately. And this is not like fine-tuning adjustments Nanning, basically relaxed a restriction, such a policy has not been halted. This is in line with guidelines for the classification round of regulation.

Deputy general manager of China Railway Real Estate Guizhou company 王成平 said, like Guiyang, range mainly in the purchase of a ring, and almost no real estate within a loop, so this restriction will not be much impact on the market to relax.

According to Central Statistical Research Center Group, currently more than 40 cities in the purchase of only 16 cities in the purchase of the domain of the city, most of the city center city or inner ring only restriction. Therefore, the scope of the restriction, including the purchase of an object can relax and directed the purchase of goods trimming. Limit in the actual implementation process of narrowing the scope of purchase, the purchase will also significantly affect the intensity and effectiveness, drive around the area deal.

Dawei said that if the direct posting to cancel the purchase, it will cause relatively large rebound. But for many of the implementation of the purchase of second and third tier cities, the restriction should not strict. Therefore, in this round of deregulation process, the local government issued a document is not necessary to explicitly cancel the purchase directly, but you can take the detour relaxed way.

For example, Nanning bailout policies in order to promote the city as Beibu Gulf Economic Zone by the Beibu Gulf economic zone of the North Sea, Fangchenggang, Qinzhou, Yulin, Chongzuo residence households considered permanent residents in Nanning in Nanning buyers. Such reasons and ways to easily imitated by other cities.

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