Even under the new rules, many local authorities do not force sellers to pay the tax but instead rely on voluntary reporting. The performance of local authorities is even worse in enforcing another real estate policy to encourage construction of economically affordable residential buildings.

Though aimed at providing more affordable housing for ordinary people, the policy turned out to be the engine for the price rise of larger commercial residential housing.

Some local governments could hardly excuse themselves from the lack of supervision in these cases.

Their unwillingness is explained by the fact that local governments' performance is evaluated on local GDP, and real estate plays a big part.

GDP-obsessed

"Since real estate industry usually plays a leading role in boosting the economy of an area, obviously there are few incentives for local governments to slow down the development of the real estate," said Gu Jianfa, professor at Research Center of City and Real Estate, Shanghai Academy of Social Sciences.

Wang Keqiang, professor of Research Center for Public Policy, Shanghai University of Finance and Economics, shares Gu's opinion.

He said it's impossible for the central government to thoroughly supervise the execution of every policy.

"Certain local governments simply choose not to carry out or to fully carry out the decisions of the central government that they find either do them no good or have a relatively high execution cost," Wang said.

Obviously, if central government policies are really to take effect in the future, the solution lies in enforcing them at the local level.

To promote affordable housing policies, the central government should first not judge performance of local officials by GDP alone.

The central government should devise effective means so that local governments are not so reliant on the real estate for income, advancement and other benefits.

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