Shanghai Daily news

In yet another move to rein in its soaring housing market, Shanghai yesterday implemented new restrictions on real estate transactions.
Property owners must now pay off their mortgages entirely before transferring the deed to a new buyer, according to the Shanghai Housing and Land Administrative Bureau.
In addition, the waiting period between the sale and the transfer of the property to the new owner has been extended from the present seven days to 28 days, in a apparent attempt to make any bridge loans more expensive.
Yesterday's announcement was the second restrictive step taken in two weeks.
Shanghai's commercial banks reached consensus on March 28 to stop providing mortgage transfer services to home buyers who sold their  property within the first year of purchase.
"The new rule is aimed at curbing speculation in the local real estate market by further regulating transactions," the housing bureau said in a statement.
The effect that the move might have on slowing down rising apartment prices was not immediately clear, however. 
"The seller can ask the buyer to repay his or her debt before the transfer," said Li Ruifang of Anjia Group, a leading mortgage services provider in Shanghai.
For instance, if an apartment owner sold his or her flat for 800,000 yuan (US$96,386) and owed a mortgage of 400,000, the seller could ask the buyer for that amount as a down payment.
But as the amount owed increases so does the ability of a seller to find a buyers with a large amount of free capital.
Regarding the lengthening of the waiting period, Li said, "The longer the time, the higher the costs."
"It will raise the costs of short-term speculative capital," Li added.
Real estate analysts said these moves - and the possibility that others might follow - may cause property owners to jump for a quick sale.
"I do think that some people are looking to sell now," said Michael Hart, head of research at Jones Lang LaSalle China (North).
"The concern about government changes and the attempt to time the market shows very much how the property market is led by sentiment," he said.
But Hart was not sure whether the measures would have a huge effect.
"People have made investment based on long-term growth potential and are not worried about short-term regulatory changes," Hart said.
Shanghai's average residential housing prices reached 8,756 yuan a square meter at the end of 2004, a year-on-year rise of 25 percent, according to Savills Property Services (Shanghai) Co.
Both the local and central governments have been trying to slow the price growth for months.
Beginning on March 7th, all apartments sold in Shanghai within the first year of purchase became subject to a 5.5 percent capital gains tax.
The People's Bank of China raised mortgage interest rates on March 17, increasing the benchmark rate on five-year-plus mortgage loans from 5.31 percent to 6.12 percent.