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Shanghai and Shenzhen are preparing to lift their final restrictions on home purchases to attract buyers and rejuvenate their struggling real estate markets, according to informed sources. This change will allow individuals from other regions to buy homes in these cities, which had previously imposed strict controls. Meanwhile, Beijing is also considering similar measures. The planned easing follows recent commitments from Chinese leaders to achieve a 5% economic growth target for 2024 and to reverse the housing market's decline, marking a continued effort by policymakers to mitigate the ongoing downturn in the real estate sector.
Shanghai and Shenzhen are set to remove the last remaining restrictions on home purchases to entice potential buyers and revitalise their struggling real estate markets, according to four sources familiar with the situation. The adjustments will enable individuals from other regions in China to buy homes in these sought-after cities, which had previously imposed strict controls due to concerns over excessive speculation. Advertisement
Shanghai, China's commercial and financial centre, along with Shenzhen, often referred to as the country's Silicon Valley, is also looking to eliminate restrictions on the number of homes that Chinese citizens can purchase, according to three sources. Both cities are anticipated to announce these changes in the coming weeks, aligning with a growing number of Chinese cities that have completely lifted purchase restrictions.
All sources requested anonymity as they were not authorised to speak to the media. China's State Council Information Office, which manages media inquiries for the government, and the Ministry of Housing did not respond immediately to requests for comment. Additionally, the governments of Shanghai, Shenzhen, and Beijing did not reply to Reuters' inquiries.
Shanghai and Shenzhen implemented limits on home purchases in 2011 and 2010, respectively, to help temper rapidly rising prices. Meanwhile, the capital, Beijing, is contemplating a phased lifting of similar restrictions in most parts of the city over the long term, except for key districts like Xicheng and Dongcheng, which house China's top leadership compound, Zhongnanhai, along with various government offices, according to two sources.
The planned easing follows a pledge from Chinese leaders during a Politburo meeting on Thursday to work towards achieving the 2024 economic growth target of approximately 5% and to halt the declines in the housing market, as reported by state media. This initiative represents the latest effort by Chinese policymakers to address the prolonged downturn in the struggling real estate sector.
The anticipated removal of home purchase restrictions in major Chinese cities signals a proactive approach to stimulate the real estate market. As these changes unfold, they could play a crucial role in stabilising the economy and restoring confidence among potential homebuyers in China.
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