Pilot program for sales of completed housing

A night view of Shenzhen, Guangdong province, on March 10, 2018. [Photo/VCG]

Shenzhen has launched the first pilot program for sales of completed housing nationwide, just 20 days after Guangdong invited opinions on plans to cancel the pre-sale system for commercial housing in the province.

The commercial housing pre-sale system, which was introduced in China in 1994, allows real estate enterprises to sell their commercial housing before the properties are built, in order to ensure the cash flows for developers and promote the real estate industry nationwide. At present about 80 to 90 percent of the overall commercial housing nationwide is presold.

Shenzhen has taken the lead in reform of the pre-sale system. As early as June 2016, Shenzhen launched its first piece of land for sales of completed housing in a bid to curb the city's skyrocketing housing prices, requiring the developer to acquire a real estate completed property certificate before putting the housing on the market. After two years, the completed housing in Shenzhen has entered market.

As selling completed properties may put great pressure on the capital flows of real estate enterprises, experts and real estate developers have called on the authorities to implement the completed housing sales system in a progressive way nationwide, in order to avoid severe fluctuations in the real estate industry.