Chinese cities impose a ban on home purchasing by companies to avoid speculation

Beijing. June 29. Silkroadnews - More Chinese cities have tightened restrictions on the purchase of houses by companies amid efforts to further prevent speculation in the real estate sector, Xinhua reports.
The authorities in Hangzhou, Zhejiang Province, have suspended the sale of houses to businesses, including commercial housing and houses in the secondary market, after three companies that had the same legal representative, a man named Zhou, won a lottery to buy houses.
When there are too many buyers for one house, the seller usually organizes a drawing of the lottery to selection the applicants. Many cities of the first level and second level, such as Shanghai, Nanjing, Changsha, Chengdu, Wuhan and Xi’an, introduced a lottery system to purchase houses, while Xi’an and Changsha imposed a ban on the purchase of houses by companies.
The Shanghai authorities, including the judiciary, are considering measures to restrict, or even ban, the acquisition of houses by companies.
Chen Lei, a real estate analyst, said that as house prices continue to rise, despite the control, many speculators buy houses on behalf of companies, which worsens the situation with the underground real estate market.
Experts believe, a similar policy will be applied in other cities to combat speculation in the real estate market.