China plans new property-market support package to boost economy - Bloomberg News (updated)

KWG group

02/06/2023 11:12

(Adds details, background)
       Beijing/Hong Kong, June 2 (Reuters) - China is working
on new measures to support the property market after existing
policies failed to sustain a rebound in the sector, Bloomberg
News reported on Friday, citing people familiar with the matter.
    Regulators are considering reducing downpayments in some
non-core neighborhoods of major cities, lowering agent
commissions on transactions, and further relaxing restrictions
for residential purchases under the guidance of the State
Council, according to Bloomberg News.
    The state council did not immediately respond to Reuters
requests for comments.
    The property sector, once a pillar of economic growth,
slumped sharply last year with developers defaulting on debt or
bonds and suspending construction of presold housing projects.
    Policymakers have rolled out measures since the second half
of 2022 to stabilise the property market that has been further
boosted by the lifting of tough COVID curbs in December.
    Demand, however, remains bleak with property investment and
sales falling in April as consumers remained cautious about big
ticket spending amid concerns over incomes and jobs as a
post-pandemic recovery loses steam.
    The central bank outlined 16 measures of policy support,
including loan repayment extensions, in November.
    The housing regulator issued a notice in May that requires
local real estate brokers to reduce fees for housing
transactions and leasing services to promote healthy development
of the sector.
    UBS says several tier-2 cities have recently announced
stimulus for the property market and expectations are rising
that other cities will follow suit in coming days.
    Meanwhile, China property shares surged on Friday on hopes
of further stimulus.
    The Hang Seng Mainland Properties Index  .HSMPI  closed up
9.2% on Friday, outperforming a 4% gain in the broader Hang Seng
Index  .HIS . 
    Major developer Longfor Group  0960.HK  jumped 17.2%, while
smaller peer KWG Group  1813.HK  surged 23.3%.
    

 (Reporting by Liangping Gao in Beijing, Clare Jim in Hong Kong
and Baranjot Kaur in Bengaluru and Sriraj Kalluvila
Editing by Christina Fincher)
 ((gao.liangping@thomsonreuters.com))