China Limits Foreign Ownership of Property
November 16, 2010 - China
By Esther Fung from The Wall Street Journal Asia
China announced new limits on the ability of foreigners to buy residential or commercial property on the mainland, in its latest effort to curb the inflows of speculative money into its economy and ease inflationary pressure.
Observers said the effect would likely be small, since foreigners make up a tiny proportion of China property sales.
But the lack of details about the move could add another element of uncertainty to a real-estate market that already contends with volatility and sharp surges in values.
In a joint statement Monday with the Ministry of Housing and Urban-Rural Development, the State Administration of Foreign Exchange said on its website that foreign companies can purchase only commercial property that they plan to use themselves.
It reinforced existing rules to limit foreign individuals to buying one residential unit per person for self-use.
Foreign investments accounted for 0.8% of property development in China last year, data from the National Bureau of Statistics showed.
The foreign-exchange administration, which regulates China's currency and is known as SAFE, didn't offer additional details or examples.
Analysts said the restrictions on commercial properties probably pertain to companies that want to own and occupy buildings.
Read the rest of the article @Wall Street Journal
blog, real estate bubble, property sales, foreign ownership of property, foreign investors