Forget about handsome discounts and promotional giveaways, lower property prices are no longer tempting enough to lure prudent buyers to a housing market mired in a downward spiral. But some Chinese cities have found new bait to whet the appetite - easier access to hukou.
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China's property sector continued to cool in May, as new home prices in half of a sample of 70 major cities showed month-on-month drops, contrasted with eight in April. Only 15 cities saw month-on-month increases, substantially down from 44 in April, according to official data.
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The data highlights the dilemma many cities are facing. They are anxious to stimulate the slowing property market, a main pillar of local growth, while under central government pressure to refrain from removing property curbs imposed since 2010 to contain soaring prices.
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Concerns about the slowdown's impact on growth, land sale revenue and social stability have caused some local governments to take action. Some cities such as Nanjing and Tianjin started to ease the qualification criteria for home purchases.
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Other cities like Tongling announced fiscal subsidies, whereas the Home Provident Fund offered support for first home buyers in Yangzhou. Northeast China's Shenyang attempted to remove its home purchase restriction policy but it was called off within 24 hours.
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However, the overall impact of these measures has been limited, according to Zhu Haibin, chief China economist with J.P. Morgan.Â
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Forget about handsome discounts and promotional giveaways, lower property prices are no longer tempting enough to lure prudent buyers to a housing market mired in a downward spiral. But some Chinese cities have found new bait to whet the appetite - easier access to hukou.
