Harbin’s withdrawal of resale restrictions expected to lift Chinese housing market out of slump
- The withdrawal of a rule that forbids new owners from selling homes within three years of their purchases could ‘reverse the downward trend’
- Qingdao and Jining now allow the resale of homes within two years of purchase, down from five years previously
Harbin, in China’s northeastern Heilongjiang province, last week became the latest city to remove restrictions on the resale of houses, hinting at a trend that could lift the mainland’s US$1.7 trillion housing market out of a slump.
The city’s home prices dropped for a seventh consecutive month in February, despite a flurry of easing measures taken by the local government since October last year. The price of new homes in Harbin dropped by about 4 per cent year on year in February, while those of lived-in homes dropped by 3.4 per cent compared with last year.
The withdrawal altogether of a rule that forbade new owners from selling homes within three years of their purchases could, however, “reverse the downward trend”.
“We will see more cities joining the chorus, withdrawing some of the purchase and resale restrictions that they had implemented in the past two to three years, when the market was too hot,” said Yan Yuejin, the director of Shanghai-based E-house China Research and Development Institute.
A slump in China’s housing market has widened of late, as more developers join the ranks of defaulters, the latest being Logan Group and Sunac China. The decline comes despite a softer tone by Beijing on the sector recently, and the relaxation of some policies on the purchase and resale of homes in some cities since late last year.