Real estate continues its climb(2)

On the border

Zhang Xiaobai, 32, has always kept an eye on property prices, and her friends often joke that she behaves more like a real estate saleswoman than a PR consultant.

However, for many years she and her husband didn't own an apartment in the capital. They almost made it in March, but the plan became deadlocked over the implementation of China's new house price control polices.

"Can I call us victims of the new policies?" asked the native of Wuhan in Hubei province.

Because of their limited funds, the couple obtained a business mortgage in 2008 and paid 120,000 yuan ($19,000) for a small apartment in Yanjiao in Hebei province. Although it's outside the capital, the area neighbors the Beijing suburb of Tongzhou.

However, it never occurred to Zhang that her modest home could become an obstacle to buying a property in Beijing.

"We took a fancy to a 70-square-meter apartment that was still being built in the Tongzhou district in late March. Although it's quite a long way from my office, compared with our home in Yanjiao, it's much closer," said Zhang.

The couple's second home would cost around 1 million yuan if they obtained a low-interest mortgage through a housing fund.

"I've never dreamed of spending 1 million yuan, you know. It's much more than our savings, even after all these years. We were like beggars. We called almost every number in our address book to speak to friends and relatives. With their help, we raised the money and when the funds in our account finally came to 1 million, we both cried," she said.

"Both sets of parents live in the countryside and are in poor health. You have no idea how hard we worked to build up our savings and to win the trust of friends and relatives so they would lend us the extra money."

However, the procedure for gaining approval for a housing fund mortgage is more complicated and takes longer than that for a business loan.

"We were like cats on hot bricks while we were waiting, because we'd heard that stricter polices on loans were likely to be launched soon," Zhang recalled. "The wait was painful. Eventually, we got a call from the sales office, which completely snuffed out our hopes."

The government's new policy raised the down payment on the second property to 70 percent from 60 on April 8. "Even finding an extra 5,000 yuan would be an impossible task for us, let alone another 170,000 yuan. We explored every avenue, but we were unable to borrow more," she said.

In the end, Zhang and her husband had no option but to return the 400,000 yuan they had borrowed from friends.

"The new policies are aimed at cooling house prices, and helping ordinary people. We just want to end the daily commute between the two cities and would like a small apartment in the city in which we have worked and lived for many years. Is that too much of a luxury?" asked Zhang.