THE Shanghai Municipal Housing Welfare and Management Bureau has again quashed rumours that the government further tightened its regulations on the purchase of residential properties.

The bureau said the regulations remained the same as those introduced since February to tame speculation on the property market.

According to Chinese media reports, the authorities in Shanghai would start banning individuals without permanent residence permits from buying properties, even if they were paying social insurance premium at the required amount or income tax.

Only those who are married were eligible to buy their first property in the city. The reports were seen as a deliberate way to stimulate the market which had been lying low for some time.

However, an official from the bureau was quoted by Real Estate Times as saying that the existing requirements for home purchase were clear as non-registered permanent residents, regardless of their marital status, could only possess a property in the city.

If they already have a property, these residents are not eligible to buy a second home.

The official said registered permanent residents and their families can buy a second home but their children with permanent residence permits can only buy their first home if they are planning to marry.

Despite the control measures, the city, along with 35 other major Chinese cities, registered a year-on-year sales increase.

The prices of newly-developed apartments have been on the rise since April, according to the sales records from the local housing authorities.

In a report by China Real Estate Information Corp, the average price of some properties in Shanghai, especially high-end ones, have seen up to a 20% increase.

In its report, the China Index Academy said that some 57,000 apartments in 54 cities were sold between June 17 and 24, which was a weekly record that exceeded 50,000 units traded since last year.

The turnover posted in May by four leading Chinese real estate developers exceeded 10 billion yuan (RM4.7bil) as shown in their latest financial reports, suggesting the recovery of the market after a year-long chill.

The four companies are Poly Real Estate Group Co Ltd, China Vanke Co Ltd, Evergrande Real Estate Group Ltd and China Overseas Holdings Ltd.

Top seller Poly Real Estate Group posted a sales increase of 45% to 10.77 billion yuan (RM5.06bil), which was slightly higher than that of China Vanke. It was the first month this year that Poly Real Estate Group’s sales surpasses the 10 billion yuan (RM4.7bil) mark.

The combined turnover for the top 15 property developers in the country reached 268.6 billion yuan (RM126.2bil). For many, their turnover grew more than 20%.

A recent survey conducted by the People’s Bank of China showed that 29.4% of the 20,000 respondents in 50 cities could afford homes at the current price level.

About 15% of them said they intended to buy a property in the coming three months, the highest since last year when the central government announced its control measures on the market.

However, 20% of them said they expected house prices to increase in view of the current market climate.

China Real Estate Information Corp analyst Xue Jianrong was quoted by China Daily as saying that local governments across the country had been trying to adjust their housing control policies to help kick-start the economy.

He added that discounts offered by developers in the past few months had attracted housebuyers and this had driven up sales and property prices as well.

The central government has approved policies proposed by local governments in 33 cities on the purchase of new homes, since last August.

However, some policies aimed at boosting the market in Foshan, Wuhu, Chongqing and Chengdu cities – as well as in Henan province –have been suspended or cancelled after they were found to have conflicted with the central government’s plans to reduce house prices.

For instance, two days after a policy proposed late last month in Henan to offer a 30% discount on interest rates for first-time housebuyers, the authorities shot it down.

Last week, the Chinese Housing and Urban Rural Development Ministry reiterated that the country would steadfastly continue to implement its property market regulation policies.

The National Development and Reform Commission said media reports quoting sources from the commission as saying loosening the grip on the real estate sector would be a second card to save the market were purely fabricated.

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