An eastern Chinese city announced rule changes making it easier for people to sell homes, a move local media has called the first easing of such housing curbs nationwide in more than two years.
Heze, a city of about 9 million, in 2017 began requiring individuals to own their homes for at least two years before putting them on the market. That restriction has now been withdrawn, according to a statement from the local housing and rural-urban development bureau. Local financial daily China Securities Journal cited a real-estate analyst who described Heze as the first city to loosen housing sales curbs.
Some investors have begun to bet that China’s leaders could turn to property easing measures to soften the blow from a burgeoning trade war on an already slowing economy. An index of property firms listed in Shanghai rose as much as 1.3 percent, the most in a week. Developers traded in Hong Kong also advanced, with China Resources Land Ltd. climbing as much as 3.4 percent and China Overseas Land & Investment Ltd. up as much as 1.9 percent.
“The sales restriction had affected the market,” said Fan Guifang, a saleswoman at Hua Yang Fang Chan, a property agent with dozens of stores in Heze. “We only have two or three deals a day. Scrapping this rule means we can probably increase transaction volumes because more people will be allowed to buy and sell.”
Heze’s property regulator said the home-curb easing was designed to prevent price fluctuations. China Securities Journal said in a commentary piece that it’s too early to interpret the policy tweak as a sign of an all-round property loosening.
New-home prices rose an average 0.98 percent in November from October when they increased 1.02 percent in the 70 cities tracked by the government, according to Bloomberg calculations based on data released by the National Bureau of Statistics. Many developers registered slower sales growth last month despite offering steeper buyer discounts.
There’s an expectation among market watchers that the government will relax property curbs due to the current lackluster economic conditions, according to Steve Wong, an analyst at Essence International Financial Holdings Ltd.
“Some first- and second-tier cities are expected to loosen property controls next year, which will benefit developers with a high exposure to these cities,” he said.
Authorities in Heze put the curbs in place after property prices surged, in part due to a government programme that pumped $463 billion into the economy to replace slums with shiny new tower blocks.
There was a similar easing of policy in Lanzhou, the provincial capital of Gansu, in January. The city in China’s northwest scrapped home-buying limits in three districts on the outskirts to make purchases by non-local residents easier.