Growing concerns over a property bubble lead to the introduction of tough property restrictions in China’s capital, Beijing (photo).
The new restrictions say that permanent residents will be limited to buying two apartments, while others will be restricted to just one property.
It shows that the authorities are determined to cool down the capital’s property market, as in recent years prices have risen dramatically in Beijing and many other Chinese cities.
According to the authorities speculation is driving up prices and creating a shortage of homes.
Because the returns are often higher than the interest paid by banks, many Chinese invest in apartments.
But to Mo Tianquan, a real estate expert, the latest restrictions are a short-term fix. He told the BBC that “the city government is very determined to make sure property prices do not go up fast. In the long-run I think this will not work. they need a more market-orientated policy and regulations to support the short-term policy.”
In recent months, similar restrictions on buying property have been introduced in other cities across China, such as Shanghai.
These restrictions seem to come from the authorities’ fear that any property crash could provoke social unrest.