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What next for property market?

(Beijing Review)

11:27, May 24, 2013

Residents in Jinan, Shandong province, consult agents regarding property transactions in the provincial capital on March 4.(Photo/Xinhua)

He Yuanxiang is a Beijing-based real estate agent working at Homelink, one of the biggest house brokerages in the country. She expected a lesser workload after an extremely busy March, but that's not what she got.

In March, the central government rolled out measures designed to cool China's red-hot property market by reining in speculative investment. One of the measures, a 20-percent tax on capital gains from property sales, a pilot project in some cities, triggered widespread panic among potential buyers and sellers. Fearing higher home costs after the implementation of government control measures, potential buyers rushed to buy before the changes went into effect, creating a secondhand property-purchasing spree in March in many cities.

"After the March purchase spree, the market only cooled off for a short period and then started to heat up again," He told Beijing Review, noting that the Homelink branch she works for sealed six deals during the second weekend of May.

"If the apartment is exempt from paying the 20-percent tax, the price shoots up by hundreds of thousands of yuan by sellers. If not, secondhand-home buyers will have to pay the exorbitant tax," she said. "Anyway, home costs are higher than before. It turns out that the earlier you buy a home in Beijing, the better."

He's words were echoed by a Real Estate Blue Book published by the Institute for Urban and Environmental Studies at the Chinese Academy of Social Sciences (CASS) on April 25. The blue book projects that housing and land prices in China will see a continuous increase in 2013. In big cities like Beijing, Shanghai and Guangzhou, a sharp price surge is likely to occur in 2013, due to a growing imbalance between supply and demand. The Chinese Government will face greater pressure in terms of housing price controls and may consider expanding the capital gains tax to more regions.

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Email|Print|Comments(Editor:ChenLidan、Gao Yinan)

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