China Tightening Rules on Home Purchases to Cool Market

China’s largest cities, including Beijing and Shanghai, tightened rules on home purchases after the nation asked local governments to step up efforts to cool the property market.

Beijing, the capital, banned single-person households from buying more than one residence while Shanghai prohibited banks from giving credit to third-home buyers, according to the local administration websites. The two cities will also enforce a 20 percent tax on capital gains from property sales.

“This will help calm people’s panic about home prices,” said Yi Xianrong, a Beijing-based researcher at the Chinese Academy of Social Sciences, which advises the Cabinet. “At the same time, restrictions on home purchases don’t change the fundamental demand, and it seems the new measures in Beijing are aimed more at short-term problems rather than long-term healthy development of the property market.”


This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.