China property

Chongqing reiterates price curbs to maintain policy consistency

Developers must detail their prices for each apartment unit, and have them listed in their marketing literature, according to policy published Sunday

PUBLISHED : Monday, 09 January, 2017, 7:22pm
UPDATED : Monday, 09 January, 2017, 11:22pm

Chongqing, the most populous metropolis in mainland China, has introduced a fresh slew of measures to curb rising residential property prices, a week after the departure of its mayor, as the local government sought to maintain consistency in policy and head off any speculation of a change in price policy.

Developers must report specific prices of each of their new units, comprising the cost of land, construction and taxes when they apply for pre-sales permits from the local authorities and have them clearly labelled in their marketing literature, according to the document published on Sunday.

The housing authority will ask developers to explain if prices are considered “unreasonable,” according to the policy.

The reiteration of Chongqing’s control policy is to maintain consistency with the central government’s push to curb runaway home prices and prevent housing affordability from spilling over into public discontent.

It follows the promotion of mayor Huang Qifan in December to China’s rubber stamp legislature. Huang had been a price hawk on residential property prices in the metropolis of 31 million people, adding land supply to prevent developers from price gouging.

Chongqing’s new home prices rose 6.5 per cent in November from a year ago, compared with the 34.8 per cent surge in Shanghai, or the 42.8 per cent increase in Nanjing.

Chongqing’s new home price averaged 7,507 yuan per square metre (HK$771 per square foot) in November, a fraction of Nanjing’s 19,668 yuan per sq m, according to the China Index Academy.

Huang’s long-anticipated departure -- he’ll be replaced by deputy party secretary Zhang Quoqing, considered a rising political star -- raised speculation that Chongqing may reverse his policies, and herald in a new era of rising prices.

Some developers have even colluded to hoard their unsold property, in anticipation of possible price increases after the change in the mayoral post, agents said.

That’s attracted buyers from Beijing, Shanghai, Guangdong and Zhejiang provinces to flock to Chongqing to take advantage of the city’s low prices and lack of investment restrictions.

Out-of-town buyers now outnumber Chongqing locals in inquiries and investments of residential property, agents said. That has caused the prices of new projects to jump to between 12,000 to 13,000 yuan in December, from 9,000 yuan in September, agents said.