Top Biz News

Property ban on foreigners 'won't damage local market'

By Shen Jingting (China Daily)
Updated: 2010-02-25 13:12

Premium realty dealers say policy unlikely to affect sales of high-end homes

Premium property dealers claim the government's policy to resume restrictions on foreign people buying local properties will not hurt sales.

Foreigners are currently only allowed to buy one apartment each in the capital, and must have worked or studied in the Chinese mainland for more than one year prior to the purchase.

The rule was drawn up and took effect in early 2007 but was cancelled last year in an attempt to encourage investment and revive the property market following the global financial crisis.

Property ban on foreigners 'won't damage local market'

A security guard forbids photographers from Chang'an Ave No 8, a high-end commercial property selling at 80,000 yuan ($11,716)?per sq m. [China Daily]

The resumption was among 11 policies released by the municipal government on Tuesday, as it moved to make housing more affordable and tackle price manipulation in the real estate market.

Four Seasons residence, owned by Phoenix TV President Liu Changle, provides luxury suites for Beijing's affluent residents - its main customers are foreigners, Hong Kong and Taiwan residents.

"Our business will be affected but I don't know whether the price will go down or not," said a lady surnamed Li from Four Seasons residence.

The company has already sold 74 apartments, worth 1.1 billion yuan ($161.1 million).

Fang Xiaoqing, a property saleswoman with Sunny Era, another high-end apartment project near Beijing's Shaoyaoju subway station, said foreigners mostly prefer to buy high-quality houses, and usually pay for them in one payment due to difficulties in receiving loans in the Chinese mainland.

"An Australian couple bought a 'house king' in our project for 46,000 yuan per square meter," Fang said, "But the number of foreigners that buy houses is still small, less that 1 percent."

Longfor Properties Co, a Chongqing-based real estate developer, successfully purchased Changying land in Changyao district on Wednesday at a price of 4.54 billion yuan, after beating three other property giants Vanke, Sino-Ocean Land and CRLand.

"It's a signal that Beijing has made up its mind to curb investment-led demand in the housing market," Qin Xiaomei, chief researcher with Jones Lang LaSalle Beijing, told METRO Wednesday.

"But the effect will be limited, because no more than 5 percent of top-end flats have been purchased by foreigners or those from Hong Kong, Macao and Taiwan," Qin added.

Xinhua News Agency reported that foreigners purchased about 2,000 apartments in Beijing last year.

"Some luxury housing projects may be affected, for example by lowering their prices, but I don't see any extensive impact on the Beijing property market," said Li Wenjie, general manager of property agency Centaline China (North China region).

"I think high-end projects may change their focus to domestic buyers," said Qin, from Jones Lang LaSalle.