China’s capital has joined 40 other Chinese cities to stabilise or even lower new home prices this year. This is in response to the central government’s call to keep housing gains in check.

About 40 other Chinese cities promised that they will limit new home prices to below annual economic and disposable per-capita income growth, after the local governments were called to submit property price-control targets by the end of March.

The central government is intensifying its efforts to keep home prices affordable, after they continued increasing for 19 consecutive months to December.

“The capital city of Beijing’s property curbs always are the most severe among peers. But even that target was almost like nothing,” said Jeffrey Gao, a property analyst at the Royal Bank of Scotland Group.

Meanwhile, Shanghai has announced it will limit home price increases to no more than the rate of economic growth and average income expansion.

Prime Minister Wen Jiabao noted that China will persist in its controls on the real estate market to curb speculation, emphasising a promise to keep housing affordable.

“The government will ‘severely punish’ irregularities in the real-estate market, implement differentiated credit and tax policies and hold local officials accountable for maintaining stable home prices,” said the Premier.

According to Soufun Holdings Ltd, home prices in Beijing climbed 28 percent in December from 2009 and rose 26 percent in Shanghai.

The southern cities of Guangzhou and Shenzhen said that this year’s new home prices in their cities will be restrained at a rate below the local economies and average disposable incomes.

Shenzhen’s home price growth is approximately 10 percent and Guangzhou’s home price growth is about 11 percent.

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