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Foshan city makes U-turn on property policy

SHANGHAI: China's southern city of Foshan said it would temporarily suspend the relaxation of home purchase restrictions just hours after it became the first in the country to announce the measures.

The government of Foshan in Guangdong province said on Tuesday, Oct 11 it would allow some residents to buy a second home if certain conditions were met, but it then issued a statement on its website late in the evening that the plans had been postponed.

It said it would seek further public opinion and make a comprehensive assessment of the policy impact.

Property sales in major cities such as Beijing, Shanghai and Shenzhen have slowed sharply in recent months, after the government embarked on a campaign to rein in runaway real estate prices about two years ago.

The country has issued a slew of steps, including a maiden launch of a property tax in two cities and restrictions on the number of homes each family can buy, to curb speculation and housing inflation, which is fueling social discontent.

Consumer inflation eased in August, but is still far above the benchmark one-year deposit rate, which means people lose money putting savings in banks.

China has closed almost all traditional fundraising channels for domestic developers, including bank loans, trust funds and stock market listings, apart from five interest rate rises since last October. — Reuters

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