Beijing: China will limit credit for some home purchases to reduce speculation and rein in surging prices, Housing Minister Jiang Weixin said.
The nation will "further restrict credit for the purchase of second homes and curb speculative housing investments," Jiang said in a statement on the ministry's website yesterday after an annual work meeting. He didn't elaborate.
Premier Wen Jiabao pledged on December 27 to tackle "excessive" real-estate gains in some cities. Prices across 70 cities rose at the fastest pace in 16 months in November, fuelling concern that record lending and inflows of capital from abroad are creating asset bubbles in the world's third-biggest economy.
Crack down
"They are trying to prevent a full-blown bubble," said Lee Wee Liat, a Hong Kong-based property analyst at Nomura International Hong Kong Ltd. Lee sees potential bubbles in real estate in cities including Beijing, Shanghai, Shenzhen and Guangzhou.
China Vanke Co, the nation's biggest listed property developer, gained 0.8 per cent to 10.44 yuan (Dh5.61) as of the 11.30am local-time break in trading yesterday. The stock has fallen 12.8 per cent in the past month on concern that measures to cool the property market will hurt earnings. Poly Real Estate Group Co, the second-largest, added 1.5 per cent to 21.54 yuan, trimming its decline to 15.6 per cent.
Jiang said China will add to stocks of low-cost housing in cities with high prices. The government will also crack down on property hoarding by developers and fake pricing and sales, and ensure that housing demolition is legal, he said.
Xia Haijun, the chief executive officer of Evergrande Real Estate Group Ltd, told reporters in Hong Kong yesterday that the company is "not a developer that hoards land." Evergrande is negotiating with officials in Guangzhou over a site that newspapers said has been repossessed.
"We should scrap or adjust local property policies launched last year that no longer comply with current macroeconomic goals," Jiang said, without being more specific.
Premier Wen said on December 27 that the government should use tools including taxes and loan interest rates to restrain property prices that have "risen too quickly in some areas."
Developers listed in China dropped yesterday the most in two weeks on concern the government will implement a nationwide tax on the value of a property for the first time.
