Beijing to create property tracker

Dow Jones


China plans to establish a national system for tracking real-estate ownership and sales transactions, a key step in its effort to tame a property sector that threatens to price many Chinese out of the housing market.

A nationwide real-estate registration system could pave the way for levying a broad property tax in China for the first time. It could also help Beijing crack down on government officials and others who buy and own multiple properties despite restrictions on ownership.

"This is a tough task," said Xu Deming, vice minister of land and resources, at a work meeting on Saturday, according to the ministry's website. China has to carry this out to safeguard the interests of the public and to ensure sustainable economic growth, Mr. Xu said.

He didn't give details on whether such registrations would include the ownership of commercial property in addition to residential property. Such a system would make it easier for the authorities to detect and tax multiple property ownership.

Currently there are many local registries and systems that aren't linked, making it difficult to determine who owns what.

In November, the State Council, the country's cabinet, said real-estate registration processes that had been supervised by nine government departments would be combined into a single system overseen by the Ministry of Land and Resources.

Officials see property taxes as a sustainable solution to control speculation and keep the gap between rich and poor from widening.

It is now in place on a trial basis in Shanghai and Chongqing, but policy makers said they would expand it to more cities.

Average housing prices in 100 cities rose 11.5% in December from a year earlier, according to private data provider China Real Estate Index System. Housing prices in Beijing and Shanghai rose 28.3% and 15.6%, respectively.

Analysts said a property tax could address the issue of empty apartments kept off the rental market. Still, they say the thorny issue of privacy has hindered the progress of such efforts.

In recent years, court cases of individuals owning multiple properties have also driven calls for more transparency. In September, Gong Aiai, nicknamed "Sister House" in China, was sentenced to three years in prison for forging identification documents that allowed her to purchase 44 properties.

At the same weekend meeting, Jiang Daming, China's minister of land and resources, said farmland and the production of food must not be reduced while carrying out land reforms.

The official Xinhua news agency said authorities would restrict the purchase of rural land by rural residents, citing Mr. Jiang.

At a key policy meeting in November, Communist Party leaders said they wanted to make it easier for farmers to transfer their land.

"Rural land reform still faces strong opposition at the current stage" said research firm NSBO Beijing. "We do not expect to see large changes for the land system in the short term."