All major first-tier cities in China have taken action. Following Shanghai, Guangzhou, and Shenzhen, Beijing has also announced new policies for the housing market, which will take effect on October 1.
According to the “Financial Associated Press” report, 6 departments including the Beijing Municipal Housing and Urban-Rural Development Commission, Municipal Finance Bureau, Beijing Branch of the People’s Bank of China, Beijing Supervision Bureau of the State Financial Supervision Bureau, Beijing Taxation Bureau of the State Administration of Taxation, and Beijing Housing Provident Fund Management Center, On the evening of Monday (30th), the “Notice on Further Optimizing and Adjusting the City’s Real Estate Related Policies” was jointly issued.
The notice includes: implementing the policy of reducing existing mortgage interest rates, lowering the minimum down payment ratio for personal residential loans, increasing support for housing provident fund loans, reducing the number of years for non-Beijing households to pay social security or personal tax when purchasing a house, adjusting Tongzhou District’s residential purchase restriction policy, and promptly We will cancel the standards for ordinary residential buildings and non-ordinary residential buildings, and accelerate the construction of a new model of real estate development.
Beijing has once again loosened its closely watched purchase restriction policy, shortening the number of years non-Beijing households need to pay social security or personal income tax when buying a house.
For non-Beijing families who purchase a house within the Fifth Ring Road, the social security or individual tax payment period is reduced from “continuous payment for 5 years or more before the date of purchase” to “continuous payment for 3 years or more before the date of purchase”; for those purchasing a house within the Fifth Ring Road; For those who own a house outside the home, the payment is further reduced to “payments have been made continuously for 2 years or more before the date of purchase.” For the purchase of houses by high-level and urgently needed talents that meet the needs of Beijing’s economic and social development, the stipulation is that “the payment has been made continuously for one year or more before the date of purchase.”
Beijing has canceled the “special treatment” of Tongzhou District’s purchase restriction policy and remains consistent with Beijing’s purchase restriction policy. Households purchasing items in Tongzhou District shall follow the city’s unified policies.
In terms of credit, Beijing will lower the existing mortgage interest rates and guide commercial banks to steadily and orderly reduce the existing mortgage interest rates to near the new loan interest rates to reduce the mortgage interest burden of home buyers.
Beijing has also lowered the down payment ratio for housing loans, lowering the minimum down payment ratio for commercial personal residential loans for first-time home loans from no less than 20% to no less than 15%, and for second-home loans from no less than 35% (for purchases within the Fifth Ring Road) residence) and no less than 30% (residence purchase outside the Fifth Ring Road) are uniformly reduced to no less than 20%.
In addition, Beijing has also canceled the “mansion tax” and will promptly cancel the standards for ordinary residences and non-ordinary residences in accordance with national work arrangements.
“Beijing is relatively cautious in proposing policies, and this purchase restriction policy is also the last one among the first-tier cities in the country to propose. Compared with the policies of Shanghai and Shenzhen, Beijing’s adjustments to the purchase restriction are relatively small, and the threshold for purchase restriction years is also higher than other cities.” said Zhang Dawei, chief analyst of Centaline Real Estate.
In terms of policy intensity, compared with other first-tier cities, Beijing’s policy intensity is relatively cautious and has not adjusted the value-added tax period. Therefore, Zhang Dawei believes that Beijing’s purchase restriction policy is expected to have room for adjustment.
“Overall, Beijing’s down payment ratio has been significantly reduced, which is conducive to an active market. Compared with before, the biggest benefit from reducing the down payment ratio is improving demand. It is expected that the improving market will be the first to stabilize in the future.” Zhang Dawei said.
“This is the 10th time that Beijing has loosened its housing market policy since September 2023.” Zhang Dawei said that as the city with the most stable real estate market in the country, Beijing’s regulatory policies since 2017 have suppressed the irrational rise in the market and basically achieved this. “Houses are for living, not for speculation.” However, overly strict policies and measures have also accidentally hurt some of the real demand for owner-occupancy.
Statistics from the Centaline Real Estate Research Institute show that as of September 29, 12,331 second-hand housing units in Beijing were signed online in September, and it is expected to be around 13,000 units for the whole month, close to the low in the past seven months.
In fact, Beijing is the last first-tier city to relax purchase restrictions. Shanghai, Shenzhen, and Guangzhou all adjusted their purchase restriction policies on Sunday.
Guangzhou has completely canceled purchase restrictions; Shenzhen’s core area social security has “replaced 3 to 1”, and non-core areas do not require social security. Shenzhen has also reduced the down payment ratio and changed the value-added tax from 5 years to 2 years; Shanghai has revised the scope of purchase restrictions in the outer ring. Social security was changed from 3 to 1, value-added tax was changed from 5 to 2, and restrictions on non-ordinary residences were cancelled.
“First-tier cities are rapidly following the new housing market policies, which is a concrete manifestation of active response to the 9.26 Politburo meeting, and the policy intensity is generally in line with expectations. It is expected that the real estate market activity in various regions is expected to increase in October, which will further drive the recovery of the national real estate market. However, if To promote the national real estate market to stop falling and stabilize, it is expected that more policies will be needed,” said Chen Wenjing, policy research director of the China Index Research Institute.
Chen Wenjing believes that Shanghai and Shenzhen still have room for adjustment in their restrictive policies: for example, Shanghai can completely cancel the purchase restriction policy outside the outer ring road, lower the social security age requirements within the outer ring road, and relax purchase restrictions on large noodles above 144 square meters, and Shenzhen can completely cancel it. Purchase restrictions, etc.
“In addition, increasing home purchase subsidies, reducing transaction commissions, transaction taxes, and mortgage interest rates to further reduce home purchase costs are also important measures to help the real estate market stop falling and stabilize. More market stabilizing policies in the future are still worth looking forward to. “Chen Wenjing said.
