Shenzhen to cap private homes at 40% of supply

Beijing

THE Chinese southern boomtown of Shenzhen, famed for its eye-watering home prices, has set an unprecedented goal of capping the number of new private homes, as the government focuses on rolling out more affordable public housing.

Shenzhen plans to build 1.7 million new apartments by 2035, of which only around 40 per cent can be private homes, the city's housing authority said in a statement on its website on Tuesday.

Heeding President Xi Jinping's call for houses that "are for living in, not speculation", local governments are starting to roll out policies to ensure multiple sources of home supply and channels of financial support.

China's under-developed home rental market has been a focus in the past year, particularly in megacities such as Shenzhen, which has a population of more than 12 million.

In a national first, state lenders started giving loans last year to renters at ultra-low interest rates with long repayment periods in Shenzhen.

The housing authority said the remaining 60 per cent of new supply would be equally split among three government-subsidised housing projects - homes for workers with special skills and expertise, with a floor area of less than 90 sq m; smaller homes of less than 70 sq m; and more modest apartments of 30-60 sq m strictly reserved for rentals.

To ensure affordability, the home buyer or renter, for example, can obtain a 40 per cent discount off the property's market value or rental price under the talent scheme.

Shenzhen will also boost land supply reserved for the rental segment of the market, it said. REUTERS