Guangzhou has joined China’s three other first-tier cities – Beijing, Shanghai and Shenzhen – in relaxing restrictions on buying flats sold by private developers, as it seeks to give the sluggish property market a push.
But the city’s move is only applicable to so-called elite buyers – high-income professionals and buyers from Hong Kong, Macau and Singapore – in three districts.
It comes as China’s economy posted its slowest growth in nearly 30 years with a 6 per cent expansion in the third quarter – down from 6.2 per cent the previous quarter and 6.4 per cent in the first three months.
Cash-strapped local governments are meanwhile competing to breathe new life into their property markets, which are traditionally a key revenue earner.
Prices of new homes across China grew at their weakest pace in nearly two years in November, up just 0.3 per cent compared to the previous month, according to data from the National Bureau of Statistics.
That was the weakest growth since February 2018.
Of the 70 cities surveyed by the statistics bureau, only 44 reported monthly price rises, compared with 50 in October.
In Guangzhou, new-home prices slipped half a percentage point last month.
According to notices issued by local authorities over the past week, the city has eased the rules for property buyers in three of its main districts – Huadu, Huangpu and Nansha.
Huangpu district on Friday announced that “qualified buyers” – including people who do not have local residency but have been employed in the city for more than six months and are university educated – would be able to purchase what the government called “commercial apartments” if they were first-time homebuyers.
Eligible buyers also included “outstanding professionals”, school principals and doctors. The eased restrictions would also extend to their family members, including parents, parents-in-law and adult children.
In addition, Hong Kong and Macau residents can buy up to two flats in the district, as can Singaporeans employed at Sino-Singapore Guangzhou Knowledge City – an industrial park on the city’s outskirts.
Residents of Hong Kong and Macau have since this month been able to buy one flat in any Guangzhou district, as well as in the Qianhai special economic zone in Shenzhen, with no other restrictions on their purchases.
Qualified buyers can also purchase up to two properties in the Guangzhou districts of Huadu and Nansha, announced on Tuesday and December 13, without having to produce a local hukou – a permanent residence permit that controls access to public services based on birthplace – or evidence of having paid income tax and social security in China.
Guangzhou’s move follow similar announcements to ease restrictions on property buyers by dozens of second- and third-tier cities, including Zhongshan and Foshan in Guangdong province, Sanya in Hainan, Nanjing in Jiangsu, and Tianjin.
That trend is expected to continue, according to property consultancy CRIC China. It said in a report last week that more second- and third-tier cities were likely to relax restrictions next year and open the door to buyers who do not have local residency.
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