A Chinese City Takes Unprecedented Steps to Keep Home Prices Low
A Chinese City Takes Unprecedented Steps to Keep Home Prices Low
(Bloomberg) -- Dalian, one of the most developed cities in China’s north, is going to unprecedented lengths to keep a lid on home prices.
According to an official news agency report Wednesday that quoted a local-government statement, all home builders in the city must now seek sales approval by inputting an apartment’s proposed price into a centralized computer system. Prices must be lower than the bottom price for similar dwellings sold in May and June, and any higher prices won’t be be entertained.
There’s also a limit on what’s too low -- selling an apartment for more than 5% cheaper is prohibited as well. Dalian’s government will even bring in a third-party appraisal firm to help developers do their math, and those that don’t follow the system will be banned from the city.
Residential home prices in Dalian have gained 6.1% this year, official data show.
It’s yet another example of the sometimes extreme lengths authorities in China will go to to control the nation’s real-estate sector. Other restrictions have included banning anyone not born in a particular city from purchasing property there, or barring anyone who’s single or even just getting a divorce.
The measures come as China’s top leadership vowed Tuesday that property loosening will never feature in any economy-rescue package, reiterating a stance that housing is for “habitation, not for speculation.”
To contact Bloomberg News staff for this story: Emma Dong in Shanghai at edong10@bloomberg.net
To contact the editors responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net, Peter Vercoe
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