THE Chinese government will maintain its tough policies on the property market next year, in hopes of seeing home prices return to a reasonable level. This decision was made during the Central Economic Work Conference.

You Liying works for a magazine in Beijing. She got married last year. The couple was planning to buy a flat at that time, but home prices were above what they could afford.

The Chinese government will maintain its tough policies on the property market next year, in hopes of seeing home prices return to a reasonable level.

You Liying said, “We went flat hunting last year before we got married. But prices were too high and were still rising back then. So we had to wait. Now home prices have dropped a bit, but are still not affordable.”

To bring property prices down to a reasonable level, China has imposed a raft of measures in major cities since April 2010. The policies include higher down payment requirements, limits on the number of houses people can own and the construction of affordable housing. This November, most major cities have already seen prices drop for new home. But experts say, the current drop is not enough.

Wang Xiaoguang, from Policy Advisory Department, Chinese Academy of Governance, said, “The current policies have stopped prices from growing too fast, and have controlled excessive investments on the market. But home prices now are still not in a reasonable range.”

A document, released Wednesday after the Central Economic Work Conference, confirmed the government’s determination to regulate the property market. China will speed up the construction of affordable housing projects and progressively try to solve the housing problems for low-income urban residents.

Wang Xiaoguang said, “It is critical to continue reining-in the housing market. The goal is to bring property prices back to a more reasonable level. I personally believe a 20-percent price drop is desirable. And it should be a gradual process.”

China introduced property-tax trials in Shanghai and Chongqing at the beginning of this year, as part of its efforts to curb skyrocketing home prices and contain asset bubbles. The country expects to learn from the experience in those cities and expand the policy to more cities in 2012.

Source:cntv.cn