(Yicai) Aug. 11 -- The number of potential buyers inquiring to realtors about apartments on sale in the suburban area of Beijing, as well as property visits, surged after the Chinese capital city eased curbs on homes located beyond the Fifth Ring road.

Sales offices of property projects under development in Beijing outside the Fifth Ring saw a significant increase in traffic over the past weekend, Yicai learned during on-site visits. Even during the hottest hours, many homebuyers went out to view properties.

On Aug. 8, Beijing announced it would lift the limits on the number of home purchases outside the Fifth Ring for local residents to boost the local property market, effective Aug. 9. The Fifth Ring road is a ring-shaped expressway surrounding the city’s central urban area. The ring has a radius of around 16 kilometers, with the center being Tiananmen Square. The home purchase restriction on non-residents is still valid though.

The easing of the home-buying policy has indeed prompted many potential buyers to come for inquiries, a real estate consultant in Beijing told Yicai yesterday, adding that he was so busy he did not have time to eat.

“There are many high-quality properties beyond the Fifth Ring,” the consultant noted. “If the home-buying restrictions are further eased, Beijing’s suburban area may attract people with financial strength from surrounding cities to buy homes here.”

Suburban areas are the main focus of homebuyers in Beijing. In terms of transaction volume, apartments outside the Fifth Ring accounted for 80 percent of the city’s new home sales and over 50 percent of second-hand house sales in the first seven months of the year, according to data from the China Index Academy.

“The signal and significance of Beijing easing its property market restrictions are very prominent, reflecting the government’s determination to stabilize the real estate market,” an industry insider said.

The move will release some demand in the short term, but its impact on home prices will likely be limited, the insider noted, adding that whether it will bring fundamental changes to the local property market remains to be seen.

Easing home-buying curbs will certainly have positive effects on Beijing’s property market, said Yan Yuejin, deputy director of the Shanghai E-House Real Estate Research Institute. However, if the number of second-hand home listings in the city is not reduced, the recovery in new house demand would still be constrained, he added.

Beijing’s property market experienced a recovery in sales in the first half of the year, but the market slid again in July. New home sales plunged 30 percent from a year earlier and 28 percent from June last month, while pre-owned house sales dropped 16 percent and 18 percent, respectively, according to data from the Beijing Municipal Commission of Housing and Urban-Rural Development.

Among China’s four first-tier cities, Guangzhou is the only one that has fully lifted home purchase restrictions. Meanwhile, Beijing, Shanghai, and Shenzhen still retain curbs for their core urban areas, with conditional relaxations in suburban areas.

“Since the beginning of this year, property projects in the suburban areas of Beijing and Shanghai have faced significant pressure, which opened up the possibility for the government to lift administrative purchase restrictions,” according to China Real Estate Information.

Editors: Tang Shihua, Futura Costaglione