NEW home prices rose faster in November, the transaction volume of new housing and secondhand housing purchases increased, and a number of other indicators improved, demonstrating the effectiveness of a string of policies aimed at boosting China’s property market.
The national real estate market has entered a good stage of stabilization and reversed its downturn, which fully shows that the current series of policies is accurate and effective, Yan Yuejin, research director at Shanghai-based E-house China R&D Institute, told the Global Times on Sunday.
New home prices in 100 cities rose by 0.36 percent in November on a monthly basis, up from a month-on-month growth of 0.29 percent in October. The year-on-year growth expanded from 2.08 percent in October to 2.40 percent in November, according to the latest statistics released by domestic real estate research institution China Index Academy.
In November, the sales area of new homes in 30 key cities increased by 12.4 percent month on month, an increase of 20.6 percent year on year. The number of secondhand housing transactions in 20 key cities increased by 11.7 percent month on month, an increase of 26.3 percent year on year, according to data released by the China Index Academy on Dec. 1.
Among them, Shenzhen, one of the four first-tier cities in China, saw the transaction volume double year on year in new and secondhand housing.
Total presales of new homes registered in Shenzhen stood at 8,076 units in November, up 94.5 percent month on month, the second highest in four years, media reported on Sunday, citing data from Leyoujia, a Shenzhen-based real estate firm.
Meanwhile, the registered secondhand residential housing sales in Shenzhen stood at 7,125 units in November, up 16.5 percent month on month, the highest in nearly four years, according to Leyoujia data.
“House purchasers’ confidence gradually increased with the stabilization and increase in house prices. Essential housing needs and improvement in housing conditions will also be strengthened after a slew of policies,” Yan said.
One of the latest policies was an increased incentive in terms of property deed tax, which took effect on Dec. 1.
Individuals purchasing their only residential property or a second home, as long as the area does not exceed 140 square meters, will pay deed tax at a rate of 1 percent across the country. For properties with an area exceeding 140 square meters, the deed tax will be levied at a rate of 1.5 percent, according to the Ministry of Finance, the State Tax Administration and the Ministry of Housing and Urban-Rural Development in mid-November.
Yan said that people who want to buy a house in November are likely to wait until the policy is implemented before they register the purchase.
“Therefore, there will be an obvious surge in the purchase volume of the property market in December. In general, policies like the reduction in deed tax will have a very positive effect on the market trading in December this year and in the following year,” said Yan.
Buyers planning to buy a second home in the first-tier cities will benefit the most from the revised deed tax, as the previous tax rate in the four first-tier cities was 3 percent, Zhang Dawei, chief analyst with real estate agency Centaline Property, said in a statement.
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