China has implemented more property cooling measures, lifting the minimum down payment for second home loans to 60 percent from the current 50 percent, in a move to avert the risk of a property bubble.
“China will continue to effectively curb investment and speculative purchases of houses to consolidate and expand on previous measures,” according to a statement on the State Council’s website.
Property prices in the country surged for 19 consecutive months in December, despite the suspension of third home loans and restricting loans to developers.
The central government also set mortgage rates for second-home purchases at no less than 110 percent of the national benchmark rates, while those selling homes within five years of acquisition will be charged full transaction taxes.
China’s state council urged the local government to increase land supply, as part of the property measures to curb property prices. It said that land supply for affordable housing and the reconstruction of small towns, as well as medium and small commercial homes, should be no less than 70 percent of the regional government’s total land supply.
It added that regional governments should “strictly” create policies on property purchases and local residents who own two properties will be banned from further purchases.