“Shanghai to Build More Low-Income Homes, Prepare Property Tax” plus 2 more |
- Shanghai to Build More Low-Income Homes, Prepare Property Tax
- Shanghai mayor says property tax to curb prices
- Shanghai Mayor Says Home Prices ‘Too High,’ Prepares for Tax
| Shanghai to Build More Low-Income Homes, Prepare Property Tax Posted: 21 Jan 2011 08:19 AM PST January 21, 2011, 11:04 AM EST By Bloomberg News Jan. 22 (Bloomberg) -- Shanghai, China's financial center, will build more low-income housing and is actively preparing to introduce a property tax to curb speculation in a city whose mayor said residential prices are "too high." Shanghai will offer 5 million square meters (54 million square feet) of affordable housing this year, or about 80,000 units, and a further 2 million square meters of public rental residences, or 40,000 homes, Mayor Han Zheng said in a briefing yesterday. The city is getting help from the central government on the new tax, Han said. Chinese Premier Wen Jiabao said this week the government will "resolutely" implement controls on the real estate market in the first quarter, including curbing speculation and increasing the supply of affordable housing. China has pledged to speed up trials for the property tax to stem surging prices that have left housing too expensive for an increasing proportion of the population. "The mayor is reflecting the view of the central government, which is to suppress demand and increase supply," said Michael Klibaner, head of China research at Jones Lang LaSalle Inc. "The government's policies are intended to prevent prices from rising too quickly rather than driving prices down." Han, who said the city's housing tax is a "long-term policy," didn't give specifics on the levy. China is expected to introduce a 0.8 percent levy, which will have a limited impact on the market, according to a Nomura Holdings Inc. Jan. 10 report. "We noticed the unhealthy element where property prices are too high," Han said yesterday. "The high prices severely distorted the living function of homes and the property measures aim to promote the healthy development of the market, encouraging consumption and resolutely curbing speculation." Affordable Housing Shanghai will lower the threshold for affordable home applications, he said. Han is proposing the salary cap of 2,900 yuan ($440) be raised by 10 percent to allow more people to apply for these homes. "If the city can't solve its housing issues properly, the city will have no future," Han said. Shanghai and Chongqing are expected to be the first cities to roll out taxes for home ownership in China, according to the official Xinhua News Agency and Shanghai Securities News's Jan. 10 reports. Shanghai may introduce the tax for new homes in the first quarter while the southwestern city of Chongqing may impose a luxury-property tax at the same time, they reported. Home prices in Shanghai jumped 26.1 percent in 2010 and those in Chongqing surged 29.4 percent, according to Soufun Holdings Ltd., the country's biggest real estate website owner. Housing Curbs China's real estate prices rose for a 19th month in December, the statistics bureau said on Jan. 17, raising concerns that the government will expand curbs to limit the risk of asset bubbles in the world's fastest-growing major economy. The 6.4 percent gain was the smallest in 13 months. The government last year suspended mortgages for third-home purchases and restricted loans to developers. In October, the central bank increased interest rates for the first time in three years and raised borrowing costs for a second time Dec. 25. The property tax will probably be introduced in Shanghai and Chongqing, and rolled out to other so-called overheated cities such as Beijing, Shenzhen and Hangzhou, Nomura analysts led by Alvin Wong said in the report. A gauge of property shares on the benchmark Shanghai Composite Index dropped 28 percent last year, the most among five industry groups on the key Shanghai measure. Li Daokui, an adviser at the central bank, said a property tax should be capped at 1 percent, the Securities Times reported on Jan. 19. --Bonnie Cao and Irene Shen. Editors: Linus Chua, Andreea Papuc To contact Bloomberg News staff for this story: Bonnie Cao in Shanghai at bcao4@bloomberg.net To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php |
| Shanghai mayor says property tax to curb prices Posted: 21 Jan 2011 01:30 AM PST SHANGHAI – China's commercial capital will impose a limited property tax to help curb surging prices, Shanghai's mayor says, describing good handling of housing as crucial for the city's future. Han Zheng, who is the second most powerful official in China's biggest city, after Shanghai's Communist Party chief Yu Zhengsheng, acknowledged Friday that inflated housing costs are a serious problem for this fast-growing city of some 23 million. Migrant laborers, who constitute about a third of the city's registered population, provide many vital services and have built most of its showcase skyscrapers, are among those worst affected. But many young, middle-class workers also chafe at the soaring housing costs. "Shanghai is a densely populated mega-city and housing is a challenge for us and a top priority," Han told reporters following the annual meeting of the city legislature. "If we cannot the housing issue appropriately, the city will have no future." Housing prices in the city rose to a record average of 24,176 yuan ($3,652) per square meter in December, state media reported, up 7.6 percent from November and up 21 percent from January 2010. Many other big Chinese cities are facing similar trends, raising worries about a financially perilous asset bubble. Nationwide, surging housing costs are also confounding the government's efforts to cool inflation that has mainly been attributed to surging food prices but is spreading to other parts of the economy. China's inflation rate eased to 4.6 percent in December from a 28-month high of 5.1 percent the month before, according to data released Thursday, but given both domestic and international pressures could rebound. China announced its economy grew by a larger-than-expected 9.8 percent in the fourth quarter of last year, up from 9.6 percent in the previous quarter. Heavy investments in property development and other construction helped spur full-year growth to 10.3 percent last year. Shanghai's 2010 World Expo also brought on a building boom that has regained momentum since the six-month event, which attracted 73 million visitors to the city, ended in October. Han said the city's agenda is focused on cooling surging prices, creating jobs and providing better social welfare and housing. The city is gearing up to levy a property tax on purchases of newly built, luxury homes. While such a tax is unlikely to have much impact on the overall market, authorities say they expect it to help bring the market under better control. With their investment options limited and bank interest rates lower than the inflation rate, many families use housing as way of earning higher returns on their savings. Meanwhile, the entire government is financially dependent on land sales, construction and even property investment by various state-owned entities. The Shanghai office of the central bank has forecast that it expects housing prices to drop slightly in 2011, though the amount of transactions will remain at the same level as in 2010. The city has also tightened restrictions, limiting families to buying just one new home, freezing mortgages on third-home purchases and raising required downpayments and interest rates charged for second homes. Shanghai has set a target of keeping inflation within 4 percent this year, up from its 3.1 percent rise in 2010. This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php |
| Shanghai Mayor Says Home Prices ‘Too High,’ Prepares for Tax Posted: 21 Jan 2011 03:04 AM PST January 21, 2011, 11:04 AM EST By Bloomberg News Jan. 22 (Bloomberg) -- Shanghai, China's financial center, will build more low-income housing and is actively preparing to introduce a property tax to curb speculation in a city whose mayor said residential prices are "too high." Shanghai will offer 5 million square meters (54 million square feet) of affordable housing this year, or about 80,000 units, and a further 2 million square meters of public rental residences, or 40,000 homes, Mayor Han Zheng said in a briefing yesterday. The city is getting help from the central government on the new tax, Han said. Chinese Premier Wen Jiabao said this week the government will "resolutely" implement controls on the real estate market in the first quarter, including curbing speculation and increasing the supply of affordable housing. China has pledged to speed up trials for the property tax to stem surging prices that have left housing too expensive for an increasing proportion of the population. "The mayor is reflecting the view of the central government, which is to suppress demand and increase supply," said Michael Klibaner, head of China research at Jones Lang LaSalle Inc. "The government's policies are intended to prevent prices from rising too quickly rather than driving prices down." Han, who said the city's housing tax is a "long-term policy," didn't give specifics on the levy. China is expected to introduce a 0.8 percent levy, which will have a limited impact on the market, according to a Nomura Holdings Inc. Jan. 10 report. "We noticed the unhealthy element where property prices are too high," Han said yesterday. "The high prices severely distorted the living function of homes and the property measures aim to promote the healthy development of the market, encouraging consumption and resolutely curbing speculation." Affordable Housing Shanghai will lower the threshold for affordable home applications, he said. Han is proposing the salary cap of 2,900 yuan ($440) be raised by 10 percent to allow more people to apply for these homes. "If the city can't solve its housing issues properly, the city will have no future," Han said. Shanghai and Chongqing are expected to be the first cities to roll out taxes for home ownership in China, according to the official Xinhua News Agency and Shanghai Securities News's Jan. 10 reports. Shanghai may introduce the tax for new homes in the first quarter while the southwestern city of Chongqing may impose a luxury-property tax at the same time, they reported. Home prices in Shanghai jumped 26.1 percent in 2010 and those in Chongqing surged 29.4 percent, according to Soufun Holdings Ltd., the country's biggest real estate website owner. Housing Curbs China's real estate prices rose for a 19th month in December, the statistics bureau said on Jan. 17, raising concerns that the government will expand curbs to limit the risk of asset bubbles in the world's fastest-growing major economy. The 6.4 percent gain was the smallest in 13 months. The government last year suspended mortgages for third-home purchases and restricted loans to developers. In October, the central bank increased interest rates for the first time in three years and raised borrowing costs for a second time Dec. 25. The property tax will probably be introduced in Shanghai and Chongqing, and rolled out to other so-called overheated cities such as Beijing, Shenzhen and Hangzhou, Nomura analysts led by Alvin Wong said in the report. A gauge of property shares on the benchmark Shanghai Composite Index dropped 28 percent last year, the most among five industry groups on the key Shanghai measure. Li Daokui, an adviser at the central bank, said a property tax should be capped at 1 percent, the Securities Times reported on Jan. 19. --Bonnie Cao and Irene Shen. Editors: Linus Chua, Andreea Papuc To contact Bloomberg News staff for this story: Bonnie Cao in Shanghai at bcao4@bloomberg.net To contact the editor responsible for this story: Andreea Papuc at apapuc1@bloomberg.net This entry passed through the Full-Text RSS service — if this is your content and you're reading it on someone else's site, please read our FAQ page at fivefilters.org/content-only/faq.php |
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