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CHINA / Regional |
Non-residents face ban on property purchasesBy Cao Li (China Daily)
Updated: 2008-01-03 07:46 SHANGHAI: The city government here is considering barring non-residents from buying property as investments in the hope of curbing price rises and making homes more affordable to local low- and middle-income families. The Shanghai municipal government said in a recent directive that several departments - including the housing, land and resources bureau; the development and reform commission; and the public security bureau - were drawing up a property-purchase system for people who are not permanent residents of Shanghai. The directive said the authorities will also create a separate system for people with temporary residency permits, but no details or timetable were released. Temporary permits are issued to "badly needed" professionals from outside Shanghai, allowing them to access insurance and other benefits equivalent to those available to permanent residents. The directive follows a State Council circular calling for affordable housing for low-income urban families. The directive says affordable housing should be made available to both low- and medium-income families and calls for official efforts to secure land for such developments. Yin Bocheng, director of the Real Estate Study Center at Fudan University, said a ban on property purchases by non-residents, if adopted by the government, should help curb property speculation. "I think there are still bubbles in the property market," he said. "This is mainly because people from other regions have been buying property as investments." Statistics show that 367,100 property deals were signed in the first 11 months of last year. Of those, 1.76 percent involved overseas buyers and 16.7 percent involved people from other parts of China. "The proposed ban will help needy families, whether they are lifelong residents or long-term temporary residents," Yin said. However, he also said it was unlikely property prices would fall until people started selling off their holdings. Albert Lau, managing director of real estate firm Savills Shanghai, said it was too early to predict whether a ban on certain purchases would work. "But I think it will hamper flows of both capital and immigrants into Shanghai," he said. "And what if other cities follow suit and start banning some real estate sales?" Si Weijiang, a Shanghai lawyer, said a ban would have no basis in law and would do little to curb speculation. "Determined investors could just borrow a residency permit from a local and make a purchase," he said. "They only need to sign a supplementary agreement to state the ownership of the property. |
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