Economist Jia Kang says that the institutional building in the real estate market is the fundamental way to curb the excessive rise in the housing price and the current real estate tax reform falls short of the requirements of the timetable of the tax reform to match.
Jia kang, chief economist of the Huaxia New Supply Side Economics Institute, made the remarks at the 12th annual meeting of the China Securities Market hosted by the Security Daily on December 9.
Jia said, the rapidly heating momentum has indeed been curtailed in part of the cities after the “September 30” new policies was out. But the future development is likely to continue the “shivering and roller coaster” pattern. Restrictions on housing purchase and in mortgage used to appear time and again, but they are lifted when the economy and the real estate market become sluggish after a period of time and some local governments even came out with subsidies and loan support to heat up the real estate market. What is fundamental is, therefore the institutional building in the real estate market.
Jia holds that there are at least four aspects in the real estate institutional building: land provision system, housing purchasing system, investment and financing system and tax system. The 18th National Party Congress made it clear that there must be a law governing the real estate tax and reform measures to match at the right moment. But, in reality, we have not seen the process accelerated. Rather, we have seen a confused state that has failed to meet the requirements of the timetable for the tax reform to match as approved by the Political Bureau of the Party Central Committee.
“Chongqing and Shanghai have taken the lead in piloting the levy on the holding of property despite the disputes,” Jia said, adding that that is a valuable experience, cutting in softly and its effect tallies with the analysis and logical framework of economics. Accelerating the making of law on real estate tax and timely pushing forward reform requires the valuable experience of localities rather than international experience.
A single purchase
