Shanghai imposes tougher rules on city's property market

BEIJING, Jan 21 (Reuters) - China’s financial hub Shanghai will impose tougher regulations on its property market in response to a recent heating up of house trading in the city.

The new rules, which will take effect from Jan 22, aim to stabilize land and property prices, ramp up housing supply, and reinforce supervision of the market, a statement from the Shanghai housing authority said.

Shanghai will guide commercial banks to strictly control individual mortgages’ growth rate, prevent rushed lending, and prevent the funnelling of other loans such as consumer loans and business loans into the real estate market, it said.

The rules also set a stiffer house quota for individuals’ purchase limits and raise the threshold for exemption of value-added tax during house trading.

Shanghai’s property market saw upswings in 2020 fuelled by a population influx and cheap credit. The city’s 2020 transaction volumes of new and second-hand homes both hit nearly four-year highs, according to property consultancy E-House. (Reporting by Lusha Zhang and Meg Shen, Writing by Colin Qian; Editing by Toby Chopra)