Beijing and Shanghai have unveiled new measures aimed at invigorating their respective housing markets by reducing transaction costs for larger homes. Starting December 1, the authorities in both cities will eliminate the distinction between “ordinary” and “non-ordinary” housing, a move designed to lower the tax burden for transactions involving larger properties.
Under previous regulations, “non-ordinary” houses in Beijing and Shanghai were defined as properties with a building area exceeding 144 square meters, among other criteria. These properties were subject to higher taxes during transactions, which often discouraged buying and selling activity in the higher-end segment of the market.
“The reduction in selling costs for homeowners is expected to boost listing and sales activity, which will increase the availability of high-quality second-hand properties,” said Yan Yuejin, deputy director at E-House China R&D Institute. “This, in turn, will provide homebuyers with more options and have a positive impact on the market.”
The initiative by Beijing and Shanghai is part of a broader effort by Chinese authorities to stimulate demand amid a sluggish property market. On November 13, national authorities announced plans to enhance incentives related to deed tax, land appreciation tax, and value-added tax to support the steady and healthy development of the real estate sector.
By easing the tax burden on larger home transactions, the policy aims to encourage homeowners to sell, thereby increasing housing supply and offering more choices for buyers. This could lead to increased activity in the real estate market, benefiting both sellers and buyers.
(With input from Xinhua)
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Beijing, Shanghai cut tax on larger house transactions to boost sales
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