Following a series of tightening measures, residential markets in Shanghai and Shenzhen have slumped for the first time after a yearlong boom.
Some 283,600 square metres of residential space was sold in Shanghai in the week from March 28 – a drop of 60 per cent from the previous week – according to Shanghai-based Uwin Real Estate Research Centre. Prices also fell, by 3.4 per cent.
Labelled the toughest property cooling measure ever in China, Shanghai on March 25 announced new curbs for non-Shanghai buyers, requiring them to show proof of payment of taxes or social insurance for five consecutive years. Earlier, it was two of the preceding three years.
The new rules also raised the minimum down payment for second homes from 40 per cent to 50 or 70 per cent, depending on the size of the units.
Prices of new homes in Shanghai rose 25.1 per cent year on year last month. Shenzhen saw the biggest growth among 70 cities, with a rise of 57.8 per cent, according to China’s National Bureau of Statistics.