City's efforts to reform housing sector paying off

Shanghai's efforts to build a housing system that encourages both buying and renting made steady progress in the first half, with tightening policies to rein in speculation remaining effective in curbing prices growth.

"As tightening measures continued to be strictly implemented, the city's residential property market performed generally stable in the first six months of this year," said an official with the market supervision division of the Shanghai Housing Administration Bureau.

"The volume of new home transactions declined and prices were largely stable, with some minor decreases."

Between January and June, sales of new residential properties, excluding government-funded affordable housing, totaled 2.39 million square meters in the city, a year-on-year fall of 26 percent.

About 6.2 million square meters of pre-occupied homes changed hands, a decrease of 2 percent from same period a year ago, according to official data.

New home prices remained unchanged last month from May and fell 0.2 percent year on year. Pre-occupied home prices dipped 0.3 percent month on month and 2.5 percent year on year.

The city government is continuing its efforts to build a housing system that is good for both buyers and renters, including releasing land zoned specifically for residential leasing.

During the first six months, the city added around 125,000 rental units into the market and released a total of 34 land plots designated solely for residential leasing purposes, which would generate about 35,000 rental apartments in future supply, according to the bureau.

Under a plan released earlier, the city government will add about 200,000 rental units this year. By end-June, about 87,700 public rental apartments had already been added — 43.9 percent of the target set for the year.

To improve housing accessibility of medium- to low-income households, the city has established a housing guarantee system that mainly consists of low-rent apartments, shared ownership homes and public rental apartments as well as homes built for relocated residents under urbanization programs.

By the end of June, the city had provided low-rent apartments for a total of 121,000 households, with some 43,000 families still living in those apartments right now, after some moved out as their income improved.

Under the shared ownership program launched in 2010, six batches of applications have so far been processed and a total of 130,000 households have either signed purchase contracts with the government or been confirmed as qualified families.

Applications for the seventh batch will kick off in the fourth quarter.

Shanghai authorities had built of stock of about 164,00 public rental apartments by the end of last month, which have benefited more than 300,000 households over the course of the program.

In a separate move to regulate the city's residential leasing market, Shanghai launched an official online platform for home rental this month after a three-month trial. The platform is designed to offer a variety of services such as verifying listings, registering users' real names and signing of online contracts.

About 44,000 housing units available for leasing were listed on the platform by the end of June and the average daily number of registered users exceeded 8,400.