Recently-announced measures by the Chinese government to cool house prices in mainland China hit share prices in Hong Kong on Monday, the financial media in that city are reporting.
The measures, which according to the Xinhua News Agency typically involved plans to ban re-sales of properties within two to three years of purchase, are to be brought into force in eight cities where house prices have been rising particularly rapidly, including Chongqing and Nanning, Bloomberg reported Chinese officials had announced over the weekend.
It said this surprised many observers who had thought China was finished trying to slow the house price market.
The financial media organisation said an index of 22 listed developers it tracks in that market “tumbled 7.5% as of 1:50pm on Monday, heading for its steepest drop in more than two years”.
It quoted a local expert, Tospur research director Zhang Hongwei, as saying that at least 44 Chinese cities had imposed resale restrictions on home-buyers thus far this year.
As reported here earlier this month, the latest report on global house prices from the perspect of Chinese buyers issued twice a year by the Hurun Research Institute found that house prices in key cities in China, while lower than in many other of the world’s cities, had been rising faster than those in any other major world markets.
It noted that the southern Jiangsu province city of Wixi had emerged “as the fastest-growing city in mainland China”, while Zhengzhou, Changsha, Guangzhou and Shijiazhuang also made its Top 10.
In seeking to curb soaring house prices, China has joined a growing number of governments around the world, many of which have been moved to act in large part because of purchases by Chinese investors keen to hold their money in what they regard as solid investments outside of their home country.
Among these have been regional governments in parts of Canada and Australia, as well as Singapore and Hong Kong. UK government officials have also been reported to be considering measures to cool the purchase of UK residential property for investment purposes by overseas investors.