Property tax holds promise for deflating real estate bubble

BEIJING HAS INTRODUCED NEW MEASURES to cool its real estate market. At least eight banks have raised their mortgage interest rates, and five no longer accept personal applications for loans if their pledges are commercial real estate. The Mirror, a Beijing-based newspaper, comments:

These cooling measures come at the right time. As property prices in the capital have continuously risen, hot money rushed into the realty market. If that trend continues, the ever-growing bubble in the housing market would pose a challenge to the national economy.

The falling number of secondhand house deals best shows that the measures are quite effective. According to realty agencies, the number of secondhand house deals registered via online platforms in April was 16,902, 35 percent lower than the figure in March and 36 percent lower year-on-year.