Hangzhou first major Chinese city to curb property deals after post-outbreak demand spike

Beijing

HANGZHOU, China's answer to Silicon Valley, has imposed new restrictions on property transactions after cheap credit and a relaxation of residency permits fed a demand surge.

In the first such curbs by a major city in China since the novel coronavirus outbreak began, Hangzhou's government said people deemed as "high-end talent", who have long enjoyed fewer restrictions, could not resell their homes for five years.

Hangzhou, home to tech giant Alibaba, has encouraged a wave of migration in recent years with measures to attract talent.

People who qualify as high-end talent have a greater chance of securing a home under a lottery system designed to cool the city's once-heated property market.

Home transaction volumes in Hangzhou, a city of 10 million people, rose by 49 per cent in June from a year earlier, data from researcher CRIC showed.

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That compared with the 24 per cent drop in Beijing and an 11 per cent gain in Shanghai.

Yan Yuejin, director of the Shanghai-based E-house China Research and Development Institution, estimated that more than 25 per cent of home sales in Hangzhou stem from its talent scheme.

The new regulations also raised the bar for families without a home, who also have had priority under the lottery system.

"The new measures, which are relatively intense, and a reversal of the broad loosening stance across the country, showed regulators are still very resolved to clamp down on speculation," Mr Yan said. REUTERS