What’s new: Shenzhen, one of China’s most expensive megacities, relaxed housing restrictions to allow more people to buy a home in the city, in the latest effort by a local government to bolster the ailing property market.
The city government issued a notice on Wednesday stating that residents with local household registration, or hukou, will no longer be required to pay personal income taxes and social insurance for three consecutive years to buy a home. Additionally, the city reduced tax and social insurance payment requirements for migrant workers to be eligible for home purchase from five years to three years.
The new policies rolled back previous measures introduced in 2016 and 2020 to cool the city’s white-hot housing market as the city now tries to arrest a plunge in home sales. New home sales in Shenzhen declined 8.2% in 2023 to a five-year low, according to industry consultancy Leyoujia.
Background: Shenzhen is the last among China’s four biggest cities to make major adjustments in home purchase rules this year after the central government encouraged localities to refine housing policies based on local conditions to avert the country’s prolonged housing market downturn.
Major cities have eased their housing curbs to varying extents. On Jan. 27, Guangzhou scrapped restrictions on the purchase of large residences with over 120 square meters of space across the city. Shanghai announced on Jan. 30 that it would ease curbs on home purchases in selected regions. Beijing followed suit this week by broadening the eligibility of home purchases in one of its peripheral districts.
Contact reporter Han Wei (weihan@caixin.com)
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