The capital of eastern China’s Shandong province will now allow potential buyers to purchase as many homes as they would like, regardless of whether or not they are residents.
The move by the city of Jinan was confirmed by officials at the Jinan Housing Administration according to a report in the South China Morning Post. The liberalised approach to housing sales is a significant departure from earlier government restrictions put in place to cool down housing prices, and appears to be response to current oversupply in the city’s home market.
Jinan’s decision to allow unlimited housing purchases regardless of residency appears to be even more liberal than measure taken by Hohhot last month. The policy by the the Inner Mongolian capital removed the limits on housing ownership per household, but made no mention of revising residency requirements. Most major Chinese cities place greater restrictions on home purchases by non-residents.
The decision by Jinan to lift the home purchase restrictions was presaged by an announcement on the city’s website a week earlier, but last week’s statements from the housing bureau were the first news of a practical implementation of the decision.
In recent months China’s central government has indicated that it would allow more flexible application of the home purchase restrictions outside of the country’s first-tier cities. According to local media reports more than 20 Chinese cities have already eased the housing sales controls which were put in place in 2011 to tamp down home price inflation.
Now that cities like Jinan are building up large inventories of unsold homes, and the spectre of a housing price crash looms, local governments are looking for ways to rekindle housing demand.
According to figures from real estate information provider CRIC, Jinan had approximately a 12 month supply of unsold new homes at the end of May. worth of unsold new houses at the end of May.
The average price of new residential housing in Jinan fell 0.4 percent in May, compared to April according to data from China’s National Bureau of Statistics.