If you do not know what I am talking about, you must be confused by the headline. The deal with the new property tax is this – China will impose an additional 1% property tax on properties that are 3 times more than the average market price. This is Baloney in my view. Its so unsubstantial to quantify a property tax based on such a flimsy qualification. And the idea is to TRIAL it in Shanghai first, and this “TRIAL” is only going to be going online in 2012 – well that’s a whopping 1.5 years to go.
China has been known for its efficiency as well. Its previous measures such as the restricted loans to real estate developers and imposed higher interest rates and down payments for second mortgages did help to cool surging property prices that rose by records in some cities in the second quarter. And these measures were introduced at a mere “snap of the fingers”. A directive from the top brass in the ruling party.
My view is that the market believes that this new property tax is a hoax as well. Why? Just look at some of the property counters on SGX, one of the most popularly traded Yanlord, is seeing high volume for sometime, and still shows signs of an upward trend, although it seems to be meeting resistance.
So stay tuned for this interesting bit of news. Its going to be quite a show for sure. Subscribe to us – and be connected.