(adds Guangzhou housing policy changes)
BEIJING Oct 5 China's southern megacities of
Guangzhou and Shenzhen are the latest centres to impose new
measures to cool their overheated real estate markets,
including higher mortgage downpayments and home purchase
A property boom has given a welcome boost to China's
economy this year, fuelling demand for everything from
construction materials to furniture, but a growing buying frenzy
is adding to worries about ever-rising debt and risks to the
The new measures are the latest steps to tighten credit
flowing into the property sector as the government tries to
balance the need to prevent bubbles while stimulating economic
Prices for new homes in the booming tech centre of Shenzhen
rose 36.8 percent from a year ago in August, while Guangzhou's
new home prices rose 21.1 percent over that period, National
Bureau of Statistics (NBS) data showed.
Other cities including Chengdu, Jinan, Wuhan and Zhengzhou
have already announced new restrictions on property purchases as
the government tries to dampen prices stoked by property
speculators in second- and third-tier cities across the country.
The average new home price in 70 major cities climbed an
annual 9.2 percent in August, up from 7.9 percent in July,
according to the National Bureau of Statistics.
Nomura analysts said the new measures were expected to help
cool frothy prices in the biggest cities and should prevent the
market frenzy from spilling over into smaller cities.
"We also believe it unlikely that the latest tightening
measures will cause the bubble to burst, sparking a collapse of
home prices. We envision a more likely scenario to be a mild
retreat or prolonged flattening of home prices in tier-1
cities," they said in a note on Tuesday.
First-time home buyers in Shenzhen will face minimum
downpayments of 30 percent, but deposits for others will be
raised to no less than 50 percent, state news agency Xinhua
quoted a government document as saying.
Downpayments for second-home buyers in China's southern
Guangdong province near Hong Kong will be increased to no less
than 70 percent, Xinhua said without giving further details.
China's southern city of Guangzhou has limited local
residents to purchasing a maximum of two properties, according
to a statement posted late on Tuesday on the Guangzhou
Non-local residents will be allowed to buy one property, if
they can prove they have paid appropriate levels of tax or
Separately, local media reported on Tuesday that Suzhou in
China's eastern Jiangsu province had unveiled fresh measures
steps, including higher downpayment requirements, to cool the
(Reporting by Kevin Yao and Sue-Lin Wong; Editing by Alison
Williams and Eric Meijer)