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China's Shenzhen raises property deposit thresholds

Monday, March 28, 2016 - 09:36

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The southern Chinese city of Shenzhen has raised deposit requirements for some home buyers, the latest in a series of measures being introduced across the country to calm property markets, according to the official Xinhua news agency.

[SHANGHAI] The southern Chinese city of Shenzhen has raised deposit requirements for some home buyers, the latest in a series of measures being introduced across the country to calm property markets, according to the official Xinhua news agency.

China's housing market bottomed out in the second half of 2015 after slowing for more than a year, but a strong rebound in prices in the country's biggest cities have sparked fears of overheating and raised concerns of a property bubble.

Shenzhen has been the hottest property market in the country, with prices up nearly 57 per cent in February from a year earlier.

The Shenzhen municipal government said on Friday that first-time buyers who have taken out mortgages over the past two years and some second-time buyers must now make a 40 per cent downpayment, an increase from the 30 per cent previously required, said Xinhua.

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Non-local buyers must have paid three consecutive years of income tax and social security premiums, up from one year, if they wish to buy a home in the city.

Shenzhen authorities also said they had banned financial institutions including online firms and small lending firms from offering margin lending to home buyers, according to Xinhua.

Shenzhen will also increase land supply and build more government-funded houses to balance demand and supply.

Authorities in Shanghai tightened mortgage downpayment requirements for second-home purchases on Friday.

REUTERS

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