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Property prices have soared in China's biggest cities such as
financial hub Shanghai and capital Beijing since last year,
prompting regulators to step up control to cool the market to
avoid a crash.
Shanghai's housing bureau said in a notice that a lottery system
to govern new home sales would be introduced. A notary office
would handle the lottery to ensure fairness when buyers
outnumber available units.
Real estate analysts say the lottery system, though never put in
place formally before, has been frequently employed by
developers and sales agents to allocate popular new units.
A Shanghai-based employee from a large real estate firm told
Reuters the process could be rather opaque as the results could
be pre-determined based on connections or even bribes, but the
new measures would mainly affect smaller developers.
"The rules are not entirely new, just that they are more refined
and detailed. As a large developer we've made sure to do
everything by the books," the person said.
Local governments have strictly capped the prices for new units,
effectively deterring developers from launching new projects for
sale, thus reducing the supply in the market, said the person,
who declined to be identified as he is not authorized to speak
to the media.
The notice also forbade real estate firms and agents from any
form of property speculation, and said it would set up a
blacklist for those who violate rules.
It also called for the strict implementation of a real-name
purchasing system preventing buyers from purchasing property
using different names, thereby circumventing ownership
restrictions.
The moves followed a slew of other measures that were introduced
in the city in March and October last year.
Local housing authorities expect Shanghai house prices to remain
stable in 2017 as a result of these measures aimed at giving
priority to genuine home buyers rather than speculators.
(Reporting by Jing Wang and David Stanway; Additional Reporting
by Yawen Chen in BEIJING; Editing by Jacqueline Wong)
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