Guangzhou Relaxes Requirements for Home Buyers
Guangzhou is relaxing the down payment requirements for those first and second home buyers as the first local housing market stimulus that was rolled out by top tier city. the third largest city based on gross domestic product in China have lowered that down payment ratio under the housing provident fund policies, which allows first time homebuyers to pay at least 20 percent which is down for 30 percent for apartment that are smaller than 144 square meters. For second home buyers the down payment ratio was lowered to 30 percent from 60 percent.
Local authority has relaxed the rules for those non permanent residents that will allow more to be eligible to borrow mortgage loans under the housing provident fund that is usually 1 to 2 percent lower than loans from banks. The Guangzhou housing market recovery is indeed slow among the four first tier cities and the latest measures have underscored the intentions to stabilize and improve the property market.
With China’s new home prices has edged up to 0.05 percent from April to May which is the first increase in 14 months as prices in first tier cities has improved as much as 2.2 percent. Property downturn is said to be one of the biggest drags on the economy that is also growing at its weakest pace. However the three other top tier cities namely Shanghai, Beijing and Shenzhen are unlikely to follow as local officials are concerned over the fast rising property prices in these cities in the past few months as values in lower tier cities continues to slow.