China's eastern metropolis of Shanghai on Friday issued a slew of policies to tame its property market, including raising down payment requirements for second home buyers.
Under the new rules, which came into effect on Friday, those who already own a house must make at least a 50-percent down payment, instead of the previously required 40 percent, when applying for home loans. The minimum down payment rises to 70 percent if the home's size and price surpass the criteria for an ordinary house.
Non-local buyers must also prove they have paid income tax and social security premiums in the city for five consecutive years, up from two years under the previous requirement. The city will ban developers and housing agencies from offering certain loan services to buyers.
It also vowed a tougher clamp-down on house speculation and price-gouging. The regulations are meant to curb surging prices in the city's property market resulting from "irrational emotions," speculation and illegal practices by some companies and agencies, said Gu Jinshan, a director with the city's housing and urban-rural development commission.
New home prices in Shanghai jumped about 20 percent year-on-year in February, and similar price hikes were also reported in Beijing and Shenzhen, suggesting a warming market in top-tier cities.
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