Wuhu loosens property rules

Wuhu city in East China's Anhui Province has loosened restrictions on the property sector, joining the rank of local governments that are attempting to revive the slowing housing market.

But experts noted Thursday that such moves will not change the downward trend in the markets.

Second-home buyers in Wuhu can now enjoy subsidized loans, a favorable policy that only applied to first-home buyers in the city previously, media said Thursday.

Also, people who have just started working in Wuhu companies can apply for a housing fund loan, which enjoys lower interest rates, immediately instead of having to wait for six months, according to media reports.

Some local governments have started to ease rules on house buying amid the cooling market. Several cities, including Ningbo in East China's Zhejiang Province and Nanning in South China's Guangxi Zhuang Autonomous Region, have loosened home buying rules.

Liu Yuan, a senior research manager at Centaline China Real Estate, said that more cities are likely to join the ranks and roll out policies to stimulate the housing sector, as the property sector plays a vital role in local fiscal revenue and GDP growth.

Meanwhile, some local governments have implemented rules to prevent property prices from dropping too much.

In Hangzhou, East China's Zhejiang Province, a new rule announced that from May 22 if transaction prices plunge more than 15 percent from the price registered with the housing authorities, the transaction will be made invalid.

Dongguan, in South China's Guangdong Province, has also adopted a similar rule, media reported.

Despite the fact that an increasing number of local governments are trying to boost the housing market, experts noted that the moves will not avert the downward trend, as many cities are burdened by oversupply and people would rather wait and see.

JPMorgan economist Zhu Haibin predicted on Tuesday that China's property prices are likely to see a moderate decline of 2 percent this year.

"The central government wants the property market to adjust under the market mechanism," Hui Jianqiang, a senior expert at China Real Estate Association, told the Global Times on Thursday.

Experts noted that the central government is not very likely to relax the property controls on a nationwide scale, as housing prices are not likely to report a major drop, no systematic financial risk has been noted and the cooling is still not endangering overall economic growth.