Following Shanghai, other first-tier cities such as Guangzhou and Shenzhen have also introduced major real estate policies.

Among them, Guangzhou has the strongest policy intensity, completely lifting purchase restrictions, becoming the first city in first-tier cities to completely exit the purchase restriction policy. Shenzhen has introduced various real estate policies, including loosening purchase restrictions; reducing the first home down payment ratio to 15%, and the second home down payment ratio to 20%; adjusting the VAT exemption period from 5 years to 2 years; canceling restrictions on the transfer of commercial residential and commercial apartment properties.

"On the evening of September 29, the Ministry of Housing and Urban-Rural Development and the People's Bank of China intensively deployed new policies to optimize purchase restrictions, adjust mortgage rates. First-tier cities successively adjusted purchase restrictions, loan restrictions, and tax policies, with the aim of boosting market expectations and increasing trading volume as the 'Silver Ten' approaches, as well as the last quarter of the year, to contribute their own efforts to the annual growth target, and play a stabilizing role in the real estate market." said Li Yujia, Chief Researcher of the Housing Policy Research Center at the Guangdong Provincial Urban Planning and Design Institute.

"The real estate policy environment has entered an unprecedentedly loose stage, with the policies in Guangzhou and Shenzhen carrying significant signaling implications, also creating favorable conditions for subsequent relaxation of policies in various regions and continued market recovery." Yan Yuejin, Deputy Director of E-House Research Institute, believes that the opening of the historically loose policy relaxation window signifies the gradual arrival of a 'real estate bull market' trend.

Guangzhou becomes the first first-tier city to completely exit purchase restrictions.

On September 29, the General Office of the Guangzhou Municipal People's Government issued a notice on adjusting measures for the stable and healthy development of the real estate market, canceling all purchase restrictions for resident families buying homes in the city, with this measure officially implemented starting from September 30, 2024.

After this adjustment to the purchase restriction policy, resident households, non-resident households, and singles in Guangzhou can now buy homes throughout the city without verifying purchase qualifications or limiting the number of homes they can buy.

"Guangzhou is the first first-tier city to fully lift purchase restrictions. The adjustment of this policy is expected to release market demand, boost market confidence, and promote the steady and healthy development of the local market." Zhang Bo, director of the 58 Anjuke Research Institute, told reporters that this comprehensive opening up of purchase restrictions in Guangzhou is also a specific action following the '926' Central Political Bureau meeting's call to promote the stabilization of the real estate market and adjust housing purchase restrictions.

"Since the beginning of this year, Guangzhou's second-hand housing prices have recorded one of the highest declines among hot cities, hence Guangzhou has canceled the remaining purchase restrictions." Li Yu Jia said.

Several analysts believe that Guangzhou's complete withdrawal of purchase restrictions sets a very strong example.

Zhang Bo stated that as a first-tier city, Guangzhou's policy adjustment carries significant symbolic significance. The relaxation of purchase restrictions in Guangzhou is expected to stimulate housing demand and boost market confidence. Although cities including Shanghai and Shenzhen have not completely lifted purchase restrictions, it also indicates that under the backdrop of the 'dual-track system,' the comprehensive lifting of purchase restrictions in the property market will be a major trend.

"Guangzhou's policies have a positive orientation, which also means that localities can make good use of real estate control autonomy, tailor policies according to local conditions, and implement good housing policies." Yan Yuejin said.

"The cancellation of purchase restrictions is more conducive to diversified improvement in demand entry. Guangzhou, located in the core area of the Greater Bay Area, is an important city in the integrated economic development belt of Guangzhou and Foshan. Its strong appeal to newcomers, combined with the wide range of housing prices in Guangzhou, is more conducive for newcomers to settle here. It is expected that this move will drive an increase in Guangzhou's real estate transaction volume in October." Zhang Bo said.

Various aspects of Shenzhen have eased restrictions on the real estate market.

In addition to Shanghai and Guangzhou, Shenzhen also issued major loosening policies for the real estate market on the evening of September 29, implementing loosening measures in various areas of home purchase. These policy adjustments will release housing demand, increase market activity, lower the threshold for home purchases, promote demand for improvement, and increase market liquidity.

Analysts believe that in terms of loosening purchase restrictions, this adjustment in Shenzhen can be described as a targeted removal, especially for non-local residents buying houses in non-core areas, which previously required one year of social security contributions and is now completely abolished.

According to the policy, local residents in Shenzhen are limited to the purchase of 2 residential properties per family, while single adults with local residency are limited to 1 property. Based on the implementation of the above housing purchase restrictions, within the Yantian District, Baoan District (excluding Xinan Street and Xixiang Street), Longgang District, Longhua District, Pingshan District, Guangming District, and Dapeng New District, an additional purchase of 1 property is allowed.

Non-local residents and single adults are limited to the purchase of 1 residential property. When purchasing a property within Futian District, Luohu District, Nanshan District, Xinan Street of Baoan District, and Xixiang Street, proof of one year of continuous individual income tax or social security contributions in the city prior to the purchase date is required. Purchasing property within the Yantian District, Baoan District (excluding Xinan Street and Xixiang Street), Longgang District, Longhua District, Pingshan District, Guangming District, and Dapeng New District does not require proof of individual income tax or social security contributions.

"Non-local residents of Shenzhen no longer need social security when buying houses in the above non-core areas. Although these regions are on the periphery, there are no longer restrictive thresholds for young new residents of Shenzhen to purchase houses, which is bullish for first-time homebuyers," said Zhang Bo.

In terms of down payment ratios, Shenzhen has adjusted the minimum down payment ratio for the first commercial personal housing loan to 15% and for the second housing to 20%. The special cooperation zone of Shenshan has unified the minimum down payment ratio for the first and second commercial personal housing loans at 15%, canceling the lower limit of interest rates.

"In terms of the actual reduction, the benefits for second-home buyers are more significant. Although not meeting the minimum 15% standard set by the central bank, it has significantly lowered the threshold for the upgrade group, making it more favorable for them to enter the market," pointed out an industry analyst in the real estate sector.

In addition, Shenzhen has lifted restrictions on the transfer of commercial residential and office apartments. After obtaining the real estate registration certificate for commercial residential and office apartments, they can be listed for trading. In terms of reducing transaction taxes and fees, Shenzhen has adjusted the VAT exemption period for personal residential property transfers from 5 years to 2 years.

"This is a policy that the market has been eagerly anticipating. There is a significant demand in the market for upgrading to new homes, but the cost of changing homes is high, especially the high transaction taxes and fees. This policy can effectively reduce transaction costs, revitalizing the existing market," stated the above real estate industry analyst.

Analysts at Leyoujia believe that the latest real estate policies in Shenzhen, especially the improvement in the target customer group for second-home buyers, will have a bullish effect on market transactions to provide certain support. "Overall, the new real estate policies in Shenzhen are conducive to improving market expectations and enhancing the confidence of homebuyers."

It is worth noting that on September 29, the Party Group meeting of the Ministry of Housing and Urban-Rural Development conveyed and studied the spirit of the Politburo meeting, emphasizing the need to thoroughly implement the important deployment of the Party Central Committee to promote the stabilization of the real estate market. It guides effective implementation of existing policies in various regions and strengthens efforts to promote the effectiveness of new policies. It is necessary to respond to public concerns, support cities, especially first-tier cities, in using their autonomy in real estate market regulation, and adjust the housing purchase restrictions based on local conditions.

As the month of October, known as the 'Silver September' in the real estate market, arrives, and as the final quarter of the year approaches, first-tier cities Shanghai, Guangzhou, and Shenzhen have all announced adjustments to their housing purchase restriction policies, with only Beijing yet to make any adjustments.

"Achieving a stable real estate market as soon as possible depends crucially on the leading first-tier cities in the property market. First-tier cities have a concentration of new urban residents and migrants, with great potential for housing needs. At the same time, the real estate development in first-tier cities started earlier, with large real estate and population scales, especially in recent years with industrial transformation and upgrading, the demand for home upgrades among long-time residents is also quite concentrated." said Li Yujia.

Yan Yuejin believes that the current adjustments, optimizations, or cancellations of purchase restrictions in Shanghai, Guangzhou, and Shenzhen will have a positive impact on market expectations, playing a very positive role in driving a comprehensive market recovery.

Editor/Lambor