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China again taps brakes on soaring land prices

BEIJING: Beijing has again told local authorities to step up efforts to curb excessive land price increases that have contributed to higher housing prices.

The Ministry of Land and Resource has told local governments to "pay a close attention to real estate market movements and to firmly implement regulatory and control measures" as a way to cool down heated bidding for land.

Despite property tightening measures, developers have shown a renewed thirst for land in recent weeks and have thrown a huge amount of cash in state land auctions, pushing land prices to all-time new highs in Shanghai, Guangzhou, Wuhan and Wenzhou.

For land sales with more than a 50% premium rate or record high prices, local governments should report to provincial land authorities and the ministry within two working days after the deal is closed, the statement published late on Sunday, Dec 19 said.

China has repeatedly vowed to keep land supply and prices at reasonable levels, but as local governments are increasingly relying on revenues from land sales for local fiscal expenses, warnings from Beijing have been often neglected.

In China's land "market", the only supplier is the local government that sells land via public auctions, and property developers often jostle in these auctions to acquire land, resulting in hefty prices.

In an auction in Guangzhou last week, Poly Real Estate snatched a piece of land with a unit price of 20,605 yuan (RM9,725.29) per square metre — an all-time high in the city. — Reuters
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