The number of visitors to apartments listed for sale in Beijing surged after the city eased restrictions on homes within the Fifth Ring Road and increased the maximum borrowing limit for housing loans from the housing provident fund.
The Longfor Guancui development near Zhongguancun Science Park experienced approximately a 37% rise in foot traffic over the past weekend compared to the previous one, according to a sales representative. Many prospective buyers, previously hesitant due to financial concerns, decided to proceed with their purchases thanks to the availability of lower-interest loans through the provident fund.
On August 7th, Beijing implemented a new policy allowing residents without local household registration to purchase a home within the Fifth Ring Road after paying social security or individual income tax in the city for just one year, a reduction from the previous two-year requirement.
Furthermore, first-time homebuyers in Beijing can now qualify for a housing provident fund loan up to CNY 3.4 million (approximately USD 504,000), more than doubling the previous cap of CNY 1.6 million. These loans are particularly appealing because they come with significantly lower interest rates compared to traditional bank mortgages.
“Two groups of returning clients opted for larger four-bedroom units because the increased loan limit made their payments more manageable,” a sales staffer explained.
Sales centers for properties represented by Heshuo reported viewing increases of 50% to 60% last weekend compared to the prior one, while transaction volume grew by roughly 10% to 20%, according to Guo Yi, the chief analyst at a real estate consultancy in Beijing.
Properties situated between the Fifth and Sixth Ring Roads, which benefit from well-developed surrounding amenities, saw the most notable gains from the new policy, Guo added.
The policy also provided a significant boost to the pre-owned property market. A realtor specializing in second-hand homes shared that inquiries and home viewings at their outlets escalated last weekend, attributing the rise to the revised provident fund loan rules that brought tangible market benefits.
With the maximum loan amount doubled, most typical second-hand properties are now fully covered by the new limits, eliminating the need for many buyers to rely on higher-interest commercial bank mortgages. Guo noted that the new policy is expected to have a stronger impact on the volume of pre-owned home transactions than new property sales.
Conversely, sales of new developments outside the Fifth Ring Road and high-end projects within the ring remain sluggish, according to an employee at a leading real estate developer.
While most popular developments saw increased interest over the weekend, sales at previously slow-moving projects remained “largely unchanged,” another real estate agent observed.