Pre-owned home sales soar after new policies

Sales of pre-owned homes in Beijing almost tripled last week after the State Council's call to reinforce real estate policies, industry data showed on Monday.

According to the Beijing Municipal Commission of Housing and Urban-Rural Development, a total of 9,400 apartments were sold and signed online last week (March 2-8), up 279.5 percent year-on-year. The figure also represents an increase of 140.5 percent compared with the same period of the previous month.

The planned 20 percent individual income tax on capital gains made by home sellers is one of the key reasons behind the surging figures, as both buyers and sellers are worried about the soaring transaction costs after the policy is in place. Currently, only a 1 percent individual income tax is levied on the sale price.

"First-home purchasers, as well as those home buyers who would like to improve their living conditions, are the major two types deeply affected by the new policies," said Hu Jinghui, vice-president of 5i5j, a major Beijing-based property brokerage.