Neighboring cities such as Nanjing and Suzhou, where home prices have risen by more than 30 percent year-on-year, have introduced measures to curb speculative buying, including pushing up down payment requirements for second homes and blocking people from applying for mortgages to buy a second or third home if they have not paid off their previous mortgage.
Industry insiders believe the gap between supply and demand is the key factor for the rising property prices.
Gao Jianfeng, a property market analyst at Numora Securities, also said that limits on home purchases only work on a temporary basis.
"In such situations, unless land supply rises significantly, measures to curb soaring home prices won't be very effective," he said.
The residential property market in China is diverging, with some cities struggling to reduce huge inventories and others facing overheated markets.
Albert Lau, CEO of Savills China, said in an interview this year that for lower-tier cities facing pressure to reduce inventory, one key task is to transform the local economy and make the city more attractive to potential buyers.
If a city does not provide enough employment opportunities or attract people to settle there, it won't generate the demand for housing, he said.
