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Even smaller Chinese cities are prey to speculative home price hikes

Also, Beijing imposes harshest property curbs yet

Shijiazhuang, a city southwest of Beijing, was one of several hot Chinese markets that imposed property curbs this month. Yuangeng Zhang/Shutterstock[/caption]

New home prices continue their upward streak not just in mainland China’s biggest metropolises but also in its smaller, satellite cities.

The number of cities that registered new home price increases tallied at 56 in February, compared with 45 in January, according to new figures released Saturday by the National Bureau of Statistics (NBS).

New home prices in China inched 0.3 percent up month-on-month in February, compared with a monthly rise of 0.2 percent in January. Yearly growth for home prices reached 11.8 percent in February.

Home prices in Hefei, capital city of eastern Anhui province, rose 40.5 percent year-on-year, the fastest-growing market among 70 cities tracked by NBS.

More: China was the largest outbound property investor of 2016

In Shijiazhuang, capital of Hebei, a province adjacent to Beijing, values soared 18.2 percent year-on-year and 0.2 percent month-on-month in February. On Saturday, the city levied property curbs for the first time since 2014.

The minimum down payment ratio for local residents purchasing second homes in Shijiazhuang is now set at 40 percent. Non-local residents will not be allowed to buy more than one residential property in the city of 10 million people.

All in all, seven cities escalated their property investment restrictions in a span of 19 days this month.

Beijing unleashed its most onerous cooling measure Friday. The government raised the minimum down payment threshold for second home purchases to 60 percent, up from 50 percent earlier. “Non-ordinary home” buyers will be compelled to fork out at least 80 percent of a property's value for down payment, up from 70 per cent.

"We should better regulate housing development, marketing and intermediary services, and keep home prices from rising too quickly in popular cities," said Premier Li Keqiang at the annual session of the national legislature earlier this month.

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