Zhengzhou, the capital of central Henan province, has become the first mainland Chinese city to ease restrictions on buying a second home, as more local authorities take measures to reverse a nationwide residential property market slump . The city’s banks have lowered the mortgage rate for second-home buyers, according to a document posted on the website of Zhengzhou’s government late on Tuesday. The document listed 19 measures aimed at helping real estate development. Most important among them were one allowing close relatives of people who work in Zhengzhou to buy a home in the city, and one enabling buyers who have already fully repaid one mortgage to enjoy a first-home mortgage rate on a second house. “Zhengzhou became the first city that totally lost both caps on home purchases as well as home mortgages. The measures are strong and can help the dormant market pick up,” said Du Haomin, a property analyst with Sinolink Securities. Zhengzhou, home to more than 12 million people, sold 6.5 billion yuan (US$1 billion) worth of homes in January, about half the value that changed hands a year ago. The average home price in the central city stood at 14,153 yuan per square metre in January, 5.5 per cent down year on year. Zhengzhou is a microcosm of the souring housing market across the country. The rot started to set in late last year when a succession of major developers failed to pay their debts and left uncompleted homes high and dry. Home prices across China, which had climbed for more than six years, are down by about 1.1 per cent from September last year. The central government has rolled out a spate of measures to boost sentiment as the nation’s economy grew at its slowest pace in a quarter of a century, including lowering the mortgage rate. The value of the combined contracted sales at the country’s top 100 developers fell 47.2 per cent in February from last year to 401.6 billion yuan, widening from a slump of 41 per cent in January, according to the China Real Estate Information Corporation (CRIC), which compiles industry data. Analysts are expecting more large-scale loosening measures will be seen in different cities, even big ones like Zhengzhou. “Zhengzhou is the first major, or what we call second-tier city, to roll out property relaxing measures, after small cities such as Heze and Nantong, which lowered down payments earlier. We believe such a relaxing trend will be the tone this year and more major cities will make such a move,” Du added. Earlier in February, Heze became the first city in China’s northern Shandong province to introduce easing measures, with four major banks lowering the minimum deposits for home purchases to 20 per cent from 30 per cent. Within the next two weeks, eight more cities including Nantong in the eastern Jiangsu province and Foshan, part of the Greater Bay Area , lowered their down payment requirements. “Beijing will incrementally allow local governments to ease controls on home prices, land prices, home purchases, home sales and mortgage loans,” said Lu ting, chief China economist with Nomura. “We assign a low probability to a property tax being mentioned in the Premier’s address and, even if one is mentioned, it could be downplayed by delaying the actual implementation.” He was referring to Premier Li Keqiang’s 2022 work report due to be delivered later this week at the National People’s Congress.