Reuters: Financial Services and Real Estate: China's Housing Minister reaffirms property cooling policy

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China's Housing Minister reaffirms property cooling policy Jun 6th 2012, 02:04 By Pete Sweeney SHANGHAI, June 6 | Tue Jun 5, 2012 10:04pm EDT SHANGHAI, June 6 (Reuters) - China's main real estate regulator reaffirmed its commitment to maintaining current restrictions on property sales on Wednesday, the official Xinhua news service reported, as Beijing continues to resist calls for wider easing to offset a slowing economy. A spokesperson for the Ministry of Housing and Urban-Rural Development, speaking at a press conference, denied recent reports in domestic media claiming the government was planning to loosen real estate policy, emphasizing that policies targeting real estate speculation and price inflation would remain in place. Chinese policymakers are attempting to implement targeted reforms that will reinvigorate growth in the world's second-largest economy, but without encouraging a second round of over-investment in property markets. A report released by Soufun.com, China's largest real estate website, said sales increased in 34 out of 40 large cities from April to May, causing concerns that property prices may begin to increase again. China has recently increased its policy emphasis on supporting growth, fast tracking infrastructure investment and providing subsidies for consumption, fuelling speculation that Beijing may be eyeing another round of fiscal stimulus, like the 4 trillion yuan ($635 billion) programme used to combat the last global financial crisis. But the government is worried that any policy easing will inadvertently reinflate the property bubble it has been struggling to deflate for the past two years. Government leaders have repeatedly insisted there will be no easing of the tightening policy until property prices return to what are described as "reasonable levels". The China Banking Regulatory Commission (CBRC) published a report on Friday saying it will not accelerate lending at present. Some local governments have implemented their own easing policies on property markets, such as the Yangzhou government, which has instituted a reimbursement policy for new home buyers. The housing ministry spokesperson said the central government would keep a close eye on such initiatives and would step in quickly to remedy "improper" policies. However, prices have not yet shown signs of any increase. A survey released last week by the China Real Estate Index System showed average home prices in 100 key Chinese cities fell in May. Property developer Vanke reported on Monday that property sales for the first five months of the 2012 were down 6 percent year-on-year. On Tuesday, Vanke's chief executive officer Yu Liang said in a television interview that there were about 114 million square metres of unsold property inventory on hand in China's first-tier cities, enough to last for 11 months at the current sales tempo. Link this Share this Digg this Email Reprints

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