While much of the world has been in economic free fall for the past 2 years, the situation in China has remained brighter. There, growth has continued in many segments of the Asian giant’s economy, including the housing market. In the wealthiest city of China, Shanghai, local officials are considering imposing a new property tax to help limit price gains. The news comes from the Shanghai Securities news and suggests that the government has already completed a general plan to implement the tax. The tax itself would mainly be levied against investment properties and possibly existing homes, in addition to new properties. The exact date of this tax’s arrival is not yet known, but many in the media of China are suggesting that it come into effect quickly since China is well known for acting rapidly on plans to keep control over its rocketing growth and maintain it for the future of the nation.
Analysts are suggesting that the tax will help bring demand into line with the Chinese vision of its economy and keep property more affordable for the growing middle class in the Asian nation. With the recent $1.4 trillion boom in lending from the Chinese government, the effects of economic stimulation have been felt across the country and prices were curbed to some extent. The luxury homes market continues to grow and prices there seem to be expanding at an ever more rapid pace. Sources in London suggest that these homes are appreciating in value at a phenomenal pace and with 70 major cities in China seeing strong price increases, most Chinese citizens are not pleased with the higher cost of owning a home.