Another city announces the complete cancellation of housing purchase restrictions and the abolition of new housing price limits!

According to a message from the Tianjin Municipal Housing and Urban-Rural Development Commission on October 16th, Tianjin has fully abolished the purchase restriction policies for newly-built commercial housing and second-hand housing, becoming another city to join the real estate market regulation. With Tianjin's participation, there are now only a few cities in the country that still maintain purchase restrictions, mainly including Beijing, Shanghai, Shenzhen, and some cities in Hainan. In addition, Tianjin has clearly abolished the price limit for new houses. According to statistical data from institutions, more than 10 cities have abolished the price limit for new houses this year. The industry believes that the abolition of the price limit for new houses will make housing prices more determined by market supply and demand, and it is expected that more cities will follow relevant policies in the future.

Another city fully cancels purchase restrictions, leaving only Beijing, Shanghai, Shenzhen, and some cities in Hainan to maintain purchase restrictions.

Recently, major cities in China have successively abolished residential purchase restriction policies, and Tianjin has also officially followed suit.

Tianjin recently issued the "Notice of the General Office of the Tianjin Municipal People's Government on Further Optimizing Real Estate Policies to Better Meet the Reasonable Housing Needs of Residents," which adjusts from aspects such as the complete cancellation of purchase restrictions, the reduction of commercial loan down payment ratios, and the abolition of standards for ordinary and non-ordinary housing.

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In terms of canceling housing restriction measures, the notice mentions the cancellation of restrictive measures on the purchase and transfer of newly-built commercial housing and second-hand housing in the city.

The last time Tianjin adjusted its housing purchase restriction policy was in April of this year. At that time, the restricted areas for purchase in Tianjin were the six urban districts (He Ping District, He Dong District, He Xi District, Nan Kai District, Hebei District, Hong Qiao District). On April 30th, the Tianjin Municipal Housing and Urban-Rural Development Commission and three other departments optimized the housing purchase restriction policy, clarifying that local residents purchasing a single set of newly-built commercial housing above 120 square meters in the six urban districts no longer need to verify the qualification to purchase a house.

With Tianjin's official announcement this time to cancel restrictive measures on the purchase and transfer of newly-built commercial housing and second-hand housing, it also means that Tianjin has fully abolished purchase restrictions, and housing purchases in the six urban districts are no longer restricted; at the same time, purchase restrictions for foreign buyers have also been abolished, and non-local residents purchasing houses no longer need to provide证明材料 such as tax or social security proof of qualification to purchase a house.

In addition, the new policy introduced by Tianjin clearly states that buyers using commercial individual housing loans to purchase houses will no longer distinguish between the first and second sets of housing, and the minimum down payment ratio is unified to not be less than 15%.

In terms of Tianjin's real estate market situation, the monitoring data of the China Index Academy shows that in the third quarter of 2024, Tianjin's commercial housing supply was 1.927 million square meters, a year-on-year decrease of nearly 20%, and the transaction was 1.646 million square meters, a year-on-year decrease of 14%. In September of this year, Tianjin's commercial housing transaction was 606,600 square meters, a month-on-month increase of 14.83%.Niu Xiaohui, a senior analyst at the Tianjin branch of the China Index Academy, pointed out that Tianjin's move to cancel the residential purchase restriction aligns with the current macro trend of real estate market regulation. It is expected to have a positive impact on the market's supply and demand relationship, transaction activity, and market expectations. In recent years, against the backdrop of a deep adjustment in the real estate market, the demand structure of Tianjin's residential market has shown a trend of gathering towards the core areas. The proportion of transaction area of newly built commercial residential buildings in the six urban districts has expanded for four consecutive years. Against this backdrop, the cancellation of restrictions on purchases in the six urban districts, restrictions on non-local residents, and the reduction of down payment ratios, a combination of measures, will effectively stimulate the potential demand of non-local homebuyers and local improvement-type homebuyers, thereby injecting new vitality into the market and enhancing its liquidity and activity.

Nationally, as many cities adjust housing purchase restrictions, the cities that still maintain partial restrictions include Beijing, Shanghai, Shenzhen, and some cities in Hainan.

Among them, the first-tier city of Guangzhou announced on the evening of September 29 that it would completely exit the purchase restriction; Beijing, Shanghai, and Shenzhen have also optimized and adjusted some purchase restriction policies before this year's National Day holiday to promote the stable and healthy development of the real estate industry.

This year, more than 10 cities have canceled the price limit for new homes.

It is worth mentioning that Tianjin's new policy also proposed "no longer guiding the upper limit of sales prices for newly built commercial housing." This also means that Tianjin has joined the ranks of cities that have canceled the price limit for new homes.

In the industry's view, the continuous adjustment of price limit policies is beneficial for development companies to make more flexible price adjustments to accelerate the return of funds, and it is also beneficial for higher-quality projects to achieve higher premiums, meeting the needs of different projects.

According to incomplete statistics from the China Index Academy, this year, more than 10 cities including Zhengzhou, Shenyang, Lanzhou, and Ningde have canceled the price limit for new homes; Hangzhou, Quanzhou, and other places have canceled the price limit requirement for newly transferred land; in addition, places like Shaoyang and Fuzhou have not set a lower limit on prices for specific groups of people buying houses or group purchases, indirectly relaxing the price limit.

Zhang Bo, the dean of the 58 Anjuke Research Institute, believes that after the cancellation of the price limit, the price of commercial housing will be more determined by the market supply and demand relationship. In other words, in areas where the market supply exceeds demand, real estate companies must adjust the housing prices if they want to speed up the sales pace of the project. Real estate companies themselves can flexibly adjust prices according to market conditions and their own operating conditions. For the real estate market, it does not mean that housing prices will decline comprehensively. On the contrary, the prices of some market supply and demand models with less supply and greater demand may still experience a slight increase. However, overall, in the current weak recovery environment of the market, coupled with the relatively large pressure on real estate companies to return funds, there is still room for housing prices to adjust and optimize downwards.

Zhang Bo believes that the cancellation of the price limit is in line with the new model of real estate development that China is currently building, and it is consistent with the spirit of the 20th Central Committee's third plenary session on real estate development. The "dual-track system" development path of real estate requires not only increasing the construction and supply of affordable housing to meet the rigid housing needs of the working population but also supporting the diverse improvement-type housing needs of urban and rural residents. Market-oriented promotion is the fundamental means to meet the diverse improvement-type needs of products. Only the marketization of new housing prices can promote the development industry to pay more attention to user research during the construction process, using products at different price points to cater to the needs of different customers. On the other hand, from the regulatory perspective, it has been clearly granted to the governments of various cities the autonomy of real estate market regulation, and the policy of canceling price limits is a direct reflection of city-specific policies. It is expected that more cities will follow this policy in the future to accelerate the pace of the real estate market out of the adjustment period.