New rules for luxury property projects
By AGNES CHEUNG
STRINGENT controls over the development of luxurious buildings are to free funds and land for ordinary residential and farm use.
No more new projects involving deluxe residential buildings, villas, apartments, offices or hotels can be set up or begin construction this year, while new golf courses, model antique towns and amusement parks will be strictly banned, a State Council circular said.
The notice said ordinary residential housing projects had been strapped for cash, as funds were transferred to high-end property development.
The supply of high-class property in certain areas and cities has exceeded demand, Xinhua (the New China News Agency) quoted the circular as saying.
The State Council blamed luxury property development for creating social problems. In some cities, massive migration caused by realty development triggered chaos because of resettlement difficulties.
Under the new rules, central Government and state property projects involving more than 100,000 square metres or a total investment of more than 200 million yuan (about HK$186 million), and all real estate development projects in Beijing, have to be approved by the State Planning Commission.
Projects with foreign investment involving more than US$30 million (HK$231.8 million) also need authorisation.
The rules also prohibit projects from submitting their plans for approval in phases.
Local governments have to allocate 30 per cent of land sale income for developing agricultural and other major construction projects, while coastal cities must allocate 50 per cent of such revenue to the projects.
Realty projects will not receive bank loans, authorisation for land use or construction permits if they fail to inject the capital on time, the State Council said. The circular also bans the use of a whole plot of farmland for high-end real estate.
Plots of land sold for real estate development would be retrieved if developers failed to begin construction within the period of time laid down in contracts, the notice said.