A CHINESE city that announced a plan to boost its sagging property market last Thursday has reversed course, indicating that the central government remains determined to cool the market.

The quick policy reversal by Wuhu, a city of 1.5 million people in Anhui Province, showed the central government will not relax its curbs on the real estate market this year, despite a weakening economic outlook.

Last week, Wuhu announced that it would cut taxes on home purchases and offer subsidies to buyers of smaller homes.

Under Wuhu's new policies, the local government would offer subsidies ranging from 50 to 150 yuan (US$7.90 to US$23.80) per square meter for purchases of first homes no larger than 90 square meters.

Homebuyers with more extensive educational backgrounds or professional certificates are entitled to higher subsidies, a policy that the government has cited as a method to attract more talented workers.

Although the city government insisted that the policies were intended to meet consumers' demands for home purchases and attract talented people to work in the city, concerns still arose, as people worried more cities may follow suit and lead to a rebound in property prices.

In the face of mounting criticism, Wuhu bowed to pressure on Sunday and posted a short statement saying that it will postpone the implementation of its subsidies and tax cuts in order to "ensure the stable and healthy development of the property market."

"The postponement of Wuhu's measures dashed hopes among property developers that the central government would loosen its tightening measures this year to buoy the slowing economy," said Chen Yunfeng, secretary general of the National Real Estate Managers' Association.

A similar postponement was reported in south China's city of Foshan, which in October shelved plans to ease home-purchase restrictions one day after announcing them.

Top Chinese officials have reiterated the need to rein in the property market, as soaring housing prices may add to inflationary pressures and spark social unrest. Premier Wen Jiabao pledged on Sunday that the government will continue to work to bring housing prices back to "reasonable levels."