Shanghai reduces second-home downpayments to stimulate property market

Shanghai has introduced new measures to stimulate its property market by lowering downpayment requirements and offering subsidies. The minimum downpayment for second homes located beyond the Outer Ring Road has been reduced from 20% to 15%, aligning it with the threshold for first-time homebuyers. However, the requirement for second homes within the Outer Ring Road remains at 25%.

To further encourage homeownership, the city is implementing cash incentives and subsidies. Residents purchasing new properties beyond the Outer Ring Road by March 31 of next year may be eligible for subsidies, with amounts reported between 30,000 and 80,000 yuan depending on specific program criteria. Additionally, authorities are allowing potential buyers to withdraw cash from housing provident fund accounts to cover downpayment costs for all new flats.

These moves follow similar easing of restrictions in Beijing as part of a broader effort by the central government to stabilize the national property sector. Recent data indicates a slight recovery in Shanghai, with new home sales seeing a 1% year-over-year increase in July and pre-owned home prices rising for six consecutive months as of June.