Beijing and Shanghai have both experienced positive trends in the real estate sector following new measures launched in August, resulting in an increase in sales of both first- and second-hand homes.
Shanghai rolled out a series of measures on Aug 25 to further stimulate the property sector, including the removal of purchase restrictions on suburban homes and stronger support for the housing provident fund -- a pool that workers pay into and can withdraw or take loans from when purchasing a home.
As a result, the average daily trading volume of second-hand homes from Aug 25 to 31 topped 710 units.
"The second-hand houses being sold are primarily located outside the outer ring road, with a growth of around 20 percent. The trend is quite evident in (suburban) districts like Baoshan, Jiading and Qingpu," said Li Gen, head of the Lianjia Research Institute, the research arm of the major Chinese real-estate company Lianjia.
Apart from her 50-square-meter home inside the outer ring road, local resident Mrs. Feng now owns another property outside the ring, which residents consider as the demarcation between central and suburban Shanghai.
She was previously restricted from buying houses, but under the the new measures, there are no limits on the number of homes that can be purchased outside the outer ring road for families with local household registration or who have worked in the city for at least a year.
Moreover, banks are not permitted to differentiate between first and second home purchases, further reducing the interest payment burden on homebuyers, as second home purchases previously would incur higher mortgage rates.
"Before the launch of new measures, the loan interest rate was 3.45 percent. Now, the mortgage rate of a second house for Mrs. Feng is 3.09 percent," said Wang Huixin, a real estate agent.
Meanwhile, Beijing's property market has also been recovering following its optimized housing policies released on Aug 8.
The city has removed limits on the number of home purchases outside the fifth ring road, and home-buyers will also receive strengthened housing provident fund support.
In August, the Chinese capital saw 2,824 new commercial residential units sold in August, up 2.3 percent on a monthly basis. The sales of second-hand houses reached 13,119, 4.1 percent higher than that of July.
Property markets see robust recovery in Shanghai, Beijing
