China's property controls to stay

BEIJING - China will stick to property cooling measures, especially the differentiated credit and tax policies, as well as restrictions on buying second or third homes in some cities, said a government official on Tuesday.

The country's property market is currently developing in the direction envisaged by the macro adjustment and control policies, with home prices declining in some cities since last year, said an official of the Ministry of Housing and Urban-Rural Development.

"In the first five months, the property market extended a tightening-induced correction," said the anonymous official, adding the ministry would require relevant city governments to rigorously implement cooling policies to contain speculative purchases.

He also said the authorities will take measures to increase market supplies, properly handle disputes caused by price declines and increase affordable housing for low-income earners.

The government plans to build more than 7 million affordable houses this year.

China started adopting tough measures to cool property prices in 2010. They have included tighter lending policies, higher down payments, a ban on third-home purchases, property tax trials and the construction of low-income housing.

Just when the country's prospective homeowners were beginning to expect wider price drops, intermittent easing policies at the local level -- for example, a reimbursement policy for new home buyers in the eastern city of Yangzhou -- fueled widespread predictions of loosening controls nationwide.

Talking about those easing policies, the official said the ministry will keep a close look over local authorities and instantly set about remedying improper policies.

The Chinese government has repeatedly stated that the country will maintain property regulation policies without wavering, even after economic growth slowed to a near three-year low of 8.1 percent in the first quarter of 2012.

During a recent inspection tour to Wuhan, capital city of Central China's Hubei province, Premier Wen Jiabao asked local authorities to carry out property tightening measures and increase affordable housing for low-income earners to ensure a healthy property market.