[HONG KONG] The government of China's northernmost province Heilongjiang said it aims to reduce a housing glut to a "reasonable level" by 2018 through restricting land sales and offering subsidies to rural folk looking to buy homes in urban areas.
Heilongjiang, a traditional heavy industry powerhouse that shares a border with Russia, is one of the many Chinese provinces hit by huge housing overhangs as economic growth slows. China's government has set destocking its main goal for the real estate sector this year.
Cities in Heilongjiang that take more than 24 months to clear their housing inventories will not be given new land in the next two years for residential development, the provincial government said in a statement dated April 21.
To spur demand, Heilongjiang will offer tax breaks of one to 1.5 per cent to both first- and second-time home buyers, and remove home purchase restrictions on foreigners.
It also encourages cities with high inventory levels to offer subsidies to first-time home buyers, especially villagers and farmers.
Harbin, Heilongjiang's capital, would need 25.88 months to clear all its inventory, according to Shanghai-based data provider CRIC.
China has introduced measures to encourage property purchases outside big cities, including cutting minimum down payments and taxes for first- and second-time home buyers.
In March, Shenyang, the capital of northeastern Liaoning province, said it will offer college students cash, cheaper loans and tax breaks if they buy homes.