The Chinese government will not promulgate new regulatory policy in housing industry in the near future, said Vice Minister Liu Zhifeng of Construction recently.

The macro-control work of real estate market is in a crucial time, and the focus now is on the implementation of those regulatory policies already promulgated by the government, Liu said.

"The real estate regulatory work has begun to take effect," he said.

The growth of real estate investment continues to slow down; supply-demand relations have been ameliorated; the trading structure in housing market has been adjusted; the speculative purchase has been refrained; the average housing price level has been stabilized; the growth rate for loans to real estate industry has slowed down, he said.

Three months ago seven government departments issued a joint circular in an attempt to stabilize the rocketing housing prices in China.

According to the new policy, private houses sold after being inhabited for less than two years must pay business taxes according to the whole sale price.

The circular also demanded that local real estate administrative departments make clear requirements on price levels and housing sizes before giving permission for land use, stressing reducing construction costs for affordable housing and restricting developer profits to 3 percent.

Shanghai and Hangzhou, the cities which experienced the most dramatic price hikes, saw prices lower by more than 5 percent immediately after the policy was implemented.

"Although the current market regulatory policy has made preliminary achievements, many problems still exist in the domestic real estate market, and the growth of real estate investment in some regions is still too fast," said Liu.

In the first six months this year, eight provinces and autonomous regions witnessed their growth rate of real estate investment exceed 40 percent, figures show.

Housing prices in general are still high and in some regions, the average housing prices still grow too fast, Liu said.

Some regions have not paid enough attention to the regulatory tasks set by the central government in real estate market, so the all sorts of control measures have not been implemented forcefully, he said.

"Meanwhile, many uncertain factors still exist in the market."

So as to solve the existing problems, Liu demanded further work on real estate market regulation, asking local governments at various levels to perform their obligations to stabilize housing prices.

The supply of houses with medium and low prices should be increased, and the speculative activities in the real estate market should be firmly restrained, he said.

Between January and June, investment in the real estate industry of the country rose 23.5 percent, a drop of 5.2 percentage points year-on-year, according to figures released by the National Bureau of Statistics.

(Xinhua News Agency August 5, 2005)