STARTING from today, Shenzhen will reduce the minimum down payment ratio for second homes, according to authorities.

The minimum down payment ratio for individual housing loans on second homes will be uniformly cut to 40% from the previous 70% for regular homes and 80% for non-regular homes. This adjustment will lower the financial threshold for residents to buy a second home, which will aid in better meeting the demands for both essential and improved housing.

On the same day, the city’s housing and construction bureau issued a notice titled “Announcement on Adjusting the Criteria for Identifying Regular Homes Eligible for Preferential Policies,” which clarifies the optimization of the criteria for regular homes, effective from today. The previous requirements of meeting three conditions simultaneously, namely having a building plot ratio of 1.0 or above (inclusive of 1.0), an apartment’s internal floor area of 120 square meters or below (inclusive of 120 square meters), or an apartment’s total floor area of 144 square meters or below (inclusive of 144 square meters), and a total transaction price of 7.5 million yuan (US$1.05 million) or below (inclusive of 7.5 million yuan), have been adjusted to meet two conditions simultaneously. These conditions are having a building plot ratio of 1.0 or above (inclusive of 1.0) and an apartment’s internal floor area of 120 square meters or below (inclusive of 120 square meters) or an apartment’s total floor area of 144 square meters or below (inclusive of 144 square meters).

Regular homes are subject to lower taxes than those of bigger homes.

This is Shenzhen’s latest move in its effort to promote a more accessible property market and to accommodate to its residents’ housing needs. By lowering the down payment ratio and optimizing the criteria for regular homes, the city aims to provide residents more opportunities to purchase second homes and improve living conditions.

The alteration came after Shenzhen announced in August to ease the criteria for obtaining first-home loans. First homes typically entail lower down payment ratio and lower mortgage interest rates compared to second homes. (SD News)