Beijing and Shenzhen set to relax curbs on mass residential sales

The relaxation of home purchase restrictions on the mainland’s mass residential sector might be extended to Beijing and Shenzhen, the Shanghai Securities Journal reports.

It cited sources as saying the Beijing Municipal Commission of Housing and Urban-Rural Development had recently held discussions with the taxation bureau and the capital was expected to amend its curbs on mass residential purchases soon.

Shenzhen’s local government was expected to follow a similar path in order to stimulate the property market, it said.

Flats of less than 144 square metres are currently classified as mass residential. According to the report, the government may raise the flat size limit by 10 per cent to around 158 sq m.

The relaxation would help buyers of flats of between 145 and 158 sq m by reducing the amount of tax they have to pay, with more luxury flats able to be classified as mass residential. Since the transaction cost of buying a flat would be lowered, the authorities hope such moves would attract more buyers and boost sales in the secondary market.

It has been reported that Beijing relaxed restrictions on the sale of luxury flats in the capital last month, with new projects with an asking price of 40,000 yuan per sq m (HK$50,340) or more allowed to be released for sale. New homes with an asking price of more than 100,000 yuan per sq m could be released onto the market if the building had topped-out.

The municipal government introduced restrictions on the sale of luxury projects with an asking price of 40,000 yuan per sq m or more at the end of last year.