Since Buying Stocks Worked So Well, Shandong Tries to Save the Property Market By Buying Empty Homes

Bloomberg: China's Shandong to Buy Unsold Homes Amid Property Downturn

An eastern coastal province will buy small and medium-sized residential properties and convert them into public rental homes, according to a Shandong government statement dated Sept. 1 and posted to its website on Monday. The government will also purchase or lease commercial buildings that can’t be sold for a long time and convert them into kindergartens and schools.

The move highlights efforts to prop up the property market, which with related sectors accounts for about a quarter of the nation’s economy.

"The real estate sector is the pillar industry of our national economy," Shandong’s government said in the statement. The province has accumulated 160 million square meters of unsold properties, which would take 27.3 months to sell at the current pace, according to the statement.

"The government will not directly invest in building public rental housing any more in principle, " the government said.

Shandong is the boldest province to date, but other provinces have launched aggressive policies designed to rescue the market:

Two months ago, the Ningbo Municipal Bureau of Finance issued "on efforts to promote the stable and healthy development of the real estate market, implementation of the policy of the notice." The notice said, between July 1, 2015 to 30th June 2016, in Ningbo purchase of residential and non-residential, according to their actual pay 50% of the purchase of housing credits given to housing subsidies deed. It is nearly a year, around the introduction of favorable policies in the property market, the first time aged up to one year, and the purchase of non-residential buildings preferential subsidies.

Sichuan's way was "the whole package, tour going out." Last month, Sichuan Province Housing and Construction Office, co-sponsored by the Beijing Office of Sichuan Province "Landscape Sichuan, happy life - Tianfu capital city" activities designed to focus on strengths "Tourism retirement" resources, city famous building in Sichuan to the country , to the world.

June, Xi'an introduction of market "new nine." Which clearly put forward, before July 1 this year to the end of next year, more than 90 square meters of real estate or buy second-hand housing in Xi'an, has made housing ownership certificates and payment of social insurance for more than one year, can apply for housing location including buyers spouse and minor children of the household registration formalities. At the same time, the ratio will be reduced to two percent down payment fund.

Some studies believe that, although Xi'an bailout measure has exceeded expectations, but compared with the Lanzhou remained "moderate." The introduction of the New Deal in Lanzhou, in addition to the fund dropped two percent down payment, buyers may be home, but also made it clear that as long as local continuous deposit reserve six months or more, you can apply at the local loan fund.

Lanzhou New Deal also eliminated restrictions on foreign residents of Lanzhou purchase copy and deed personal first-time buyers fell 1%, on the purchase of more than 144 square meters of housing, giving Qishuijianmian 50% discount.

Xi'an, Lanzhou two places on the property market "medicine", perhaps just some local governments to open a new round of "save the property market" in miniature.

This year, the Liaoning provincial government has issued a "market re-mobilization," the appeal, and the introduction of five new deal to save the city; Gansu is issued "market 25"; Qinghai, Henan has introduced a number of New Deal. Among them, the Qinghai released Ten New Deal, the developers "burden" intentions quite clear. For the phased development in Qinghai real estate projects, developers can be phased project capital deposit, the minimum capital ratio and ordinary commodity housing projects from 30% to 20%, in order to reduce financial pressure on developers.

In addition to actively "sell" and developers "burden", and some local governments still control the supply of land force. August 21, Foshan, Guangdong, land management work conference held in the city. Mayor of Foshan City, Lu Yi said that in order to improve the efficiency of land use, the city will supply an average rate of the past five years, less than 60% of the area, in addition to key projects and livelihood projects, suspend arrange new construction land.

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