Sat, July 07, 2012
China > Politics

Curbing property speculation a long-term task: Premier Wen

2012-07-07 10:25:03 GMT2012-07-07 18:25:03(Beijing Time)  Xinhua English

Chinese Premier Wen Jiabao (2nd R) visits residents of the Feilong Xinyuan Compound in Changzhou City, east China's Jiangsu Province, July 7, 2012. Wen paid an inspection to the city of Changzhou on Saturday. (Xinhua/Li Tao)

Chinese Premier Wen Jiabao (C) discusses with provincial and municipal govenment officials in charge of the construction, management and supervision of low-income housing, in Changzhou City, east China's Jiangsu Province, July 7, 2012. Wen paid an inspection to the city of Changzhou on Saturday. (Xinhua/Li Tao)

NANJING, July 7 (Xinhua) -- Chinese Premier Wen Jiabao said Saturday the government will resolutely implement real estate market regulation and make it a long-term task to curb speculation in this sector.

During an inspection tour of the city of Changzhou in east China's Jiangsu province, Wen said housing market regulation is still at a critical moment and remains a tough task.

Wen's remarks came as major Chinese cities saw home prices rise mildly in June, raising fears that a new price surge would begin despite recent government attempts to cool the property market through measures including restrictions on second-home purchases, higher down payments and the introduction of property taxes.

After years of hard work, property regulation has borne some fruit. However, currently, with mixed information, the market has changed expectations for future pricing and residents fear prices will rebound, Wen acknowledged.

To further implement the regulation, Wen urged unswerving efforts to ensure prices return to reasonable levels, and block a price rebound that would undermine the effects of previous efforts.

Specifically, he asked for work to prevent misleading information that would alarm consumers and urged sticking to the differentiated mortgage policy and other restrictive purchase rules.

Local authorities' moves to loosen housing regulation must be corrected in a timely fashion. Those who cheat to escape from restrictive purchasing policy should be punished, according to the premier.

Wen also urged departments concerned to accelerate the construction of affordable housing and make it sustainable.

In the first five months this year, work started on 4.7 million units of subsidized housing and 2.6 million units were basically completed.

Local authorities should push through land approval for affordable housing and invite all types of investors to participate to ensure construction progress and quality, Wen said.

According to data released by the China Index Academy earlier this week, the average home price in 100 major cities edged up 0.05 percent in June from a month ago, ending a nine-month decline.

Sales of new homes in Shanghai jumped to 1.02 million square meters in June, up 26.6 percent from May. Several real estate agencies estimated that sales of second-hand homes in June may even have increased by around 40 percent from a month earlier to top 17,000 units.

In Beijing, home sales rose to 25,602 units in June, 10.5 percent more than in May and 50.6 percent more than the June 2011 level, according to the municipal commission of housing and urban-rural development.

Signs of a warming property market are strengthened by a surprise interest rates cut announced by the central bank on Thursday.

A 25-basis-points reduction in one-year lending and deposit rates brings down the cost of buying homes and, more importantly, boosts confidence in the property market, sparking fears that the sluggish market will rebound.

However, some analysts noted, since the property curbs will continue to shut out speculative demand, the current price rise trend lacks potential to carry on.


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