The Shenzhen government has retrieved more than 870,000 square meters of unused or idle land which had been set aside for real estate development, a move aimed at further cooling the real estate market.

 

The idle land was included in 738 undeveloped plots the municipal land resources authorities had identified by June 15, occupying a total area of 20.26 square kilometers. The government launched a campaign to tighten land control in May.

 

The government did not specify what will be done with the rest of the vacant land. Two-thirds of the plots were approved for residential and industrial use and 71 percent of the land was approved before 2002.

 

Idle land includes land on which construction did not start one year after the estate developer obtained land use rights or was authorized to begin construction. It could also be considered idle land if construction was suspended for more than one year, with only one-third of the area used.

 

In a move to prevent developers from hoarding land, a practice believed to have aggravated a land shortage, the city government imposed a regulation in May to take back land purchased by developers if left idle for more than two years.

 

The tightened rule on land use is one of the government’s measures to regulate the real estate market and slow skyrocketing house prices.

 

By the end of this year the government will finish 6,000 low-rent apartments to relieve the housing problem for low-income families.

 

China raised down payments for property mortgages to 40 percent for those buying second apartments. Also, the interest rate of mortgage loans for second apartment buyers increased to 1.1 times the benchmark one-year lending rate.

 

Meanwhile, some banks in Shenzhen have suspended home loans for pre-owned homes.

 

The local taxation authority started collecting income tax and land value-added tax on transfers of pre-owned properties in September.

 

(Shenzhen Daily November 27, 2007)