Despite progress made in containing both housing prices and inflation, China will continue to implement nationwide curbs on the housing market, according to Premier Wen Jiabao.
“The government must take effective measures to consolidate the fruits of housing price controls,” he said, in a report by the People’s Daily.
The measures primarily include increased land supply and spending on new affordable housing.
As at end August 2011, 8.68 million subsidised units of Beijing’s full-year target of 10 million units were already built.
“Wen will not let housing curbs be eased,” said Alfred Lau, an analyst from MF Global Hong Kong. “If Wen signals a relaxation on the housing market, demand will likely boom overnight, and all previous work may come to naught.”
He noted that the country will finalise the list of second- and third-tier cities where purchase limits will be imposed, as well as plans to expand the restrictions to lower-tier cities.
Although prices of new homes are high in some cities, increases have continued to moderate. Prices rose 3.5 percent in September, compared with 4.1 percent in the preceding month.
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