SHANGHAI Jinfeng Investment Co Ltd, a property agent focusing on residential real estate, planed to dispose of its majority stakes in its Hangzhou and Chengdu branches as a result of a drop in business.

The Shanghai listed company said in a statement it will put up a 90 percent stake in its subsidiary in Hangzhou, Zhejiang Province and a 50 percent stake in its subsidiary in Chengdu, Sichuan Province.

The Hangzhou branch reported a net profit of 121,300 yuan (US$15,163) last year, while the Chengdu branch reported 1.22 million yuan in profits. But both branches have been struggling to make ends meet during the first half of this year after the government introduced a string of regulatory measures to rein in surging housing prices, the company said.

Shanghai-based Jinfeng withdrew from the Jiangsu market in June after the central government extended the application period for a 5.5 percent tax on the sales of second-hand homes to five years from two years.

The central government continued its efforts to curb speculation by imposing a 20 percent capital-gains tax on the sale of second-hand homes effective from August 1.

Though the city government allows sellers to pay only a 1 to 2 percent tax on the entire sales price if the seller claims that he or she can't provide the original price, it still made it more expensive for property owners to sell their houses.
A lot of sellers have put their sales plans on hold and begun renting out apartments to avoid the tax.

Potential buyers either find it more difficult to find suitable second-hand houses due to a drop in supply or are waiting to buy until they see how the new policy will affect prices.

Major real estate agents in Shanghai reported a 30 percent drop in business this month from a month ago and numbers of transactions recorded in the second quarter of this year were down 30 percent from the same period last year.

Source:佚名