2016年CRI Shanghai Authority Adopts Tougher Restriction to Cool Housing Market

 

The government of Shanghai has announced its strictest-ever restrictions² on home purchases, in a bid to cool down the overheating property market.

The new regulation to restrict the housing market takes effect immediately.

Shanghai's housing management authority says since houses are a special commodity, it's necessary to strengthen controls over the overheated property market.

Gu Jianwei, chief of the Shanghai housing and urban-rural development Commission, justifies³ the new rules by pointing out the city's soaring home prices, and panic buying.

"Since the beginning of the second half of 2015, over-heated and irrational⁴ sentiment mounted in the housing market, especially in the first quarter of this year. the growth of housing prices has accelerated. Investment and speculation⁵ on the market has risen also. Some new problems emerge as some companies and some insiders conduct illegal operations."

Under the new rules, home buyers will need to put down 50-70 percent of the price of a second home, compared to 40 percent previously⁶, to qualify for a mortgage.

Shanghai has also made it harder for non-residents to buy homes in the city.

Potential buyers who do not hold local residence permits, or hukou, must have paid social insurance or taxes in Shanghai for at least five years before they can purchase property. 

Previously the requirement was two years.

The city has seen record high numbers of transactions on the eve of the implementation⁷ of the new policy.

Many residents rushed to make a deal before the new policy took effect.

The move comes after the city saw a heated performance in the housing market after the Chinese Lunar New Year. 

According to the National Bureau of Statistics, the price for new homes increased over 25 percent compared to the same period last year. 

Yi Xianrong is a senior financial researcher with the Chinese Academy of social sciences.

As to the rising qualification threshold for non-local buyers, he says the restriction¹ in some cases may have little impact on speculators.

"If the housing price is expected to rise in the near future the restriction measures could have little effect. For example, you have to pay social insurance in the city for five years compared with the previous requirement of two years. If the speculator anticipates there will be a huge increase in housing prices, he will find a way and play tricks to change the year limit. Some speculators even fake the social insurance through hidden ways. Just as some similar cases have happened in Beijing. Beijing has seen an upsurge of social insurance after it released a similar regulation on the housing market. So the restriction has huge influence on honest people yet has little impact on gold seekers."

The researcher also points out strict implementation of the regulation can help restrict speculation.

"First one problem is the loans, the down-payment shouldn't be on loans. People pay the down-payment by borrowing money from somewhere else, if so the policy of increasing down-payment of second house purchases won't work. The authority has to intensify⁸ supervision⁹ on the case. Second, to raise down-payments of second houses can prevent many people from entering into the market. The thing is, strict implementation of the rules is a must. The housing price can be lowered only when the two elements work together."

Shanghai will also increase the supply of small- and medium-sized homes and crack down on property financing by informal financial institutions.

Some analysts¹⁰ expected other major cities to follow Shanghai's lead in tightening¹¹ housing policies.

According to a newly released regulation, houses bought within two years will be levied¹² a 5 percent value added tax for any transfer. 

First-tier cities such as Shenzhen, Shanghai and Beijing remain in the top three in new home price growth.

Senior Chinese leaders have raised concerns about the country's overheated housing market in first-tier cities during an annual parliament meeting this month.

Speaking at a press conference during the National People's Congress in Beijing which ended a week ago, China's central bank governor Zhou Xiaochuan warned banks about increased credit risk amid rising real estate prices in the biggest cities.

Shanghai is the biggest city to take action in the wake of the National People's Congress.

1 restriction   

n.限制，约束

参考例句：

• The park is open to the public without restriction.这个公园对公众开放，没有任何限制。
• The 30 mph speed restriction applies in all built-up areas.每小时限速30英里适用于所有建筑物聚集区。

2 restrictions   

约束( restriction的名词复数 )； 管制； 制约因素； 带限制性的条件（或规则）

参考例句：

• I found the restrictions irksome. 我对那些限制感到很烦。
• a snaggle of restrictions 杂乱无章的种种限制

3 justifies   

证明…有理( justify的第三人称单数 )； 为…辩护； 对…作出解释； 为…辩解（或辩护）

参考例句：

• Their frequency of use both justifies and requires the memorization. 频繁的使用需要记忆，也促进了记忆。 来自About Face 3交互设计精髓
• In my judgement the present end justifies the means. 照我的意见，只要目的正当，手段是可以不计较的。

4 irrational   

adj.无理性的，失去理性的

参考例句：

• After taking the drug she became completely irrational.她在吸毒后变得完全失去了理性。
• There are also signs of irrational exuberance among some investors.在某些投资者中是存在非理性繁荣的征象的。

5 speculation   

n.思索，沉思；猜测；投机

参考例句：

• Her mind is occupied with speculation.她的头脑忙于思考。
• There is widespread speculation that he is going to resign.人们普遍推测他要辞职。

6 previously   

adv.以前，先前（地）

参考例句：

• The bicycle tyre blew out at a previously damaged point.自行车胎在以前损坏过的地方又爆开了。
• Let me digress for a moment and explain what had happened previously.让我岔开一会儿，解释原先发生了什么。

7 implementation   

n.实施，贯彻

参考例句：

• Implementation of the program is now well underway.这一项目的实施现在行情看好。

8 intensify   

vt.加强；变强；加剧

参考例句：

• We must intensify our educational work among our own troops.我们必须加强自己部队的教育工作。
• They were ordered to intensify their patrols to protect our air space.他们奉命加强巡逻，保卫我国的领空。

9 supervision   

n.监督，管理

参考例句：

• The work was done under my supervision.这项工作是在我的监督之下完成的。
• The old man's will was executed under the personal supervision of the lawyer.老人的遗嘱是在律师的亲自监督下执行的。

10 analysts   

分析家，化验员( analyst的名词复数 )

参考例句：

• City analysts forecast huge profits this year. 伦敦金融分析家预测今年的利润非常丰厚。
• I was impressed by the high calibre of the researchers and analysts. 研究人员和分析人员的高素质给我留下了深刻印象。

11 tightening   

上紧，固定，紧密

参考例句：

• Make sure the washer is firmly seated before tightening the pipe. 旋紧水管之前，检查一下洗衣机是否已牢牢地固定在底座上了。
• It needs tightening up a little. 它还需要再收紧些。

12 levied   

征（兵）( levy的过去式和过去分词 )； 索取； 发动（战争）； 征税

参考例句：

• Taxes should be levied more on the rich than on the poor. 向富人征收的税应该比穷人的多。
• Heavy fines were levied on motoring offenders. 违规驾车者会遭到重罚。