Home tax hike draws mild reactions in Shenzhen
2013-April-2 Source: Szdaily web edition
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SHENZHEN’S long-awaited housing policies unveiled Sunday night, hours before a national deadline for local implementation, seem too mild so far to truly create shock waves in the housing market, residents and property experts said yesterday.

Many people said the local implementation of the national regulation, which levies a 20-percent tax on gains from home sales, was merely a repeat of previous regulatory policies, except with stronger diction. But a property manager said the key point of the local implementation, that the growth rate for prices of new homes should be kept under the growth rate of per capita income in 2013, would mean tougher controls for homes trying to enter the market.

The property manager, surnamed Zhang, said property developers would have to change their pricing policies to comply with the new regulation.

Residents who were transferring ownership yesterday in Shenzhen Real Estate Ownership Registration Center in Futian District said they felt little impact from the new policies. A center employee said she hadn’t yet been informed of any changes to local housing taxes.

Li Yaozhi, CEO of Centaline Property in southern China, said the policy’s impacts were yet to be seen.

“Shenzhen’s tax policy does not mention how to implement the 20-percent tax, probably to avoid excessive fluctuations of inelastic demand in the market,” Li said.

Data from the Shenzhen Municipal Urban Planning, Land and Resources Commission show that the number of transactions involving pre-owned homes in the city continued to rise for four weeks after the Central Government announced plans to increase taxes on home sales. More than 7,000 pre-owned homes were traded in Shenzhen last week, marking the city’s highest single-week transaction total in two years. March saw 18,375 transactions, nearly five times the amount of March 2012.

Zhou Xuejun with Szhome.com said Shenzhen’s pre-owned home sales would continue to rise in April, in the expectation that the 20-percent tax would be imposed, though when the tax will be imposed remained unknown.

A property researcher with Szhome.com said the local real estate market could calm down for a short period of time, but the trend of steady increases in home prices likely would continue nonetheless.

Editor: 张莹
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