Home price curb imposed in Suzhou
June 06, 2019 - Suzhou
Suzhou, a manufacturing hub near Shanghai, is considering new property restrictions to cool runaway home prices.
A second-tier city with a population of 10.7 million, its property market has reported an uptick in property sales and sentiment since February.
According to the South China Morning Post, the Suzhou government and developers decided to restrict increases in annual new home prices to within 5% in a meeting on Friday.
Fresh curbs will be implemented in July if key gauges fail to cool, according to the report.
The 5% cap means the Suzhou government wants prices to drop for the remainder of the year, as increases so far already exceed this target. The average new home price rose 8.45% in May over last year to 22,160 yuan (US$3,259) per square metre, according to consultancy CRIC.
Secondary home prices gained 5.9% in the first four months this year, according to consultancy Zhuge.com.
Homebuyers have been influenced by a strengthened outlook for the market and lower mortgage rates.
“Many buyers flocked to the market to buy a second home after news that land parcels were being auctioned at large premiums. They bought their first home three to four years ago, and have seen their values spiralling up, and wanted to repeat the success,” said Ge Wenwen, an analyst with CRIC.
He said April’s primary home sales jumped by 32% over March, which itself recorded 136% cent surge over February. Prices in Suzhou Industrial Park, the hottest district in Suzhou with the soundest jobs and education resources, hit 35,574 yuan, almost in line with the level in Shanghai.
Five plots sold in late April brought in 13.6 billion yuan, with the premium as high as 57% over starting prices, reinforcing buyers’ expectations that developers were betting on an upturn in local home prices.
The local government introduced tighter limits on bidding by developers on May 11, as well as a three-year ban on resale of new homes and a five-year ban of resale of old homes in hotspots such as Suzhou Industrial Park.
The prices of new homes in 31 second-tier cities monitored by China’s National Bureau of Statistics rose 12.3% in April from a year ago, official data shows.
Read the rest of the stroy @ SCMP
Photo : Tonino Lamborghini Hotel Suzhou
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