Government and Policy

Chinese gov't measures to cool property market 'effective'

(Xinhua)
Updated: 2010-05-07 23:12

BEIJING - China's recent measures to cool the red-hot property market had curbed excessive home price rises in some cities, a senior government official said Friday during an online discussion with Chinese netizens.

Qi Ji, vice minister of housing and urban-rural development, said the reaction to the tightening measures was positive -- after local governments implemented the measures in line with the central government's policy.

In April, the Chinese government introduced a raft of tough measures to rein in soaring home prices which grew a record 11.7 percent from a year earlier in March.

The measures included more restrictive down-payment requirements, higher loan rates, a ban on lending for third home purchases and tighter scrutiny of developers' financing.

He said rapid price growth in some cities was mainly because of a shortage of supply as well as "unreasonable demand."

"If not curbed, the excessive gains in prices could spread to more regions, affecting people's living standards and threatening financial safety and even social stability," he added.

He said the government would increase crackdowns on illegal practices by property developers, including hoarding of land and delaying sales to exaggerate profits.

The government would also strengthen checks on developers' land purchases and fund-raising, he said.

He said that the government would seek to increase supply of low-income housing and that a plan regarding construction of such housing for the period to 2012 would be unveiled before the end of July this year, he said.