March 1, 2017 / 11:44 AM / 5 months ago

China extends property curbs to satellite cities as speculative forces spill over

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A Chinese flag is seen near a construction site in Beijing's central business area, China, January 17, 2017.Jason Lee

BEIJING (Reuters) - China has extended property curbs to two satellite cities, in a sign regulators are concerned that speculators are banking on the country's ambitious urbanization plans and buying in towns nearby sprawling metropolises.

Non-local residents in Zhuozhou city, less than half an hour away by high-speed train from Beijing, will be restricted to purchasing a maximum of one home and required to make a down payment of at least 30 percent, according to a local government document released on Wednesday.

Local residents in Zhuozhou will be limited to buying two homes and required to put down at least a 50 percent down payment on their second home.

Similar but less restrictive measures were imposed in Lianjiang, less than half an hour away by fast train from the southern city of Fuzhou, Chinese media reported on Wednesday.

The Lianjiang government made it more difficult for people to buy properties by introducing measures including raising the down payment ratio for first-home buyers borrowing from the housing fund to 30 percent.

Chinese President Xi Jinping said on Tuesday the country will keep its property market stable by guiding real estate investment behaviors and market expectations.

Prices of new homes in China surged 12.4 percent last year, the fastest rate since 2011, prompting more than 20 cities to introduce property curbs to cool the market since October.

Reporting by Yawen Chen and Sue-Lin Wong; Editing by Subhranshu Sahu

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