A boy flies a kite beside a massive residential project in Luoyang, Henan province, on March 8. (Photo: China Daily/ Huang Zhengwei)
Home sales in China's largest cities rebounded in April, after a poor first quarter forced authorities to loosen some curbs on the market.
On March 30, the central bank, housing ministry and banking regulator changed the rules on down payments for second-home mortgages. The minimum deposit was reduced from 60 percent to 40 percent. For first homes, only a 20-percent deposit is required. The Ministry of Finance decided on the same day that homes held for two years or more would be exempt from transaction taxes when sold. The previous minimum was five years.
As a result, property sales in April gained 15 percent, making April the first month of sales growth nationwide for roughly a year and a half, said Wang Tao, chief China economist with UBS.
In the 54 cities monitored by real estate agency Centaline, more than 250,000 homes are expected to have been sold during April, up 10 percent from March.
"The rebound is most evident in top-tier cities, where roughly 50 percent more homes were sold in April than in March," said Zhang Dawei, Centaline research director. Some new residential complexes in Beijing, Shanghai, Guangzhou and Shenzhen have seen all their units snapped on the first day of sales.
In Beijing, more than 8,300 new homes were sold in April, up 44.5 percent from March. Existing home sales more than doubled from a year ago to over 14,500, according to real estate broker Lianjia.
In Shanghai, home sales also came alive in April after a weak first quarter. New home sales in terms of floor space rose almost 60 percent from March and were more than double those in the same period a year ago, according to Centaline.
THE HEAT IS ON
Policy easing should lift sales in the months ahead. At an annual property exhibit in Shanghai during the May Day holiday, developers such as Greenland Group, Poly Real Estate, Evergrande and Greentown showcased nearly 300 residential complexes in anticipation of an influx of potential home buyers.
