(Yicai) Oct. 16 -- China's four first-tier cities, including Shanghai and Guangzhou, have all issued new housing sales rules, with Shenzhen the last to do so, accelerating a shift away from a pre-sales model that has left buyers vulnerable to unfinished projects.

Shenzhen's rules, released yesterday, cover tighter management of housing pre-sales, promotion of completed home sales, and adjustments to land supply. Moreover, Hangzhou, a tech hub in eastern China, issued trial implementation rules for the new housing sales policy yesterday.

Industry insiders said that despite differences in the detailed measures adopted by individual cities, the overall direction is clear: requirements for acquiring land and selling homes will become stricter, and the transition toward sales of completed homes is accelerating.

The measures follow a nationwide reform package introduced on Aug. 28 to address risks in China's housing pre-sales model, under which developers sell homes before completion and use buyers' payments to finance construction. Financial difficulties at some developers have led to delays and unfinished projects, prompting authorities to tighten financing rules, protect homebuyers, and promote sales of completed homes.

The reforms follow the principle of applying existing rules to older projects and new requirements to future developments, although some cities have yet to clarify how the transition will work.

Shenzhen Prioritizes Completed Home Sales

Shenzhen is taking a gradual approach to completed home sales, while allowing developers to collect larger deposits from buyers than Beijing.

Under the southeastern city's new policy, developers acquiring residential land after Aug. 28 will be encouraged to sell homes only after construction is completed. This will be mandatory if specified in the government's land sale conditions. Developers must register sales of completed homes with the authorities and can collect deposits of up to 3 percent of the total home price after obtaining construction permits.

Sun Hongmei, a senior analyst at the Shenzhen branch of the China Index Academy, said Shenzhen is steadily advancing sales of completed homes through land supply policies. The city's 3 percent deposit cap matches Shanghai's, is more flexible than Beijing's 1 percent limit, and is more cautious than Guangzhou's 5 percent ceiling, striking a balance between developers' sales needs and homebuyers' financial security.

Regarding existing projects, Beijing, Guangzhou, and Tianjin have adopted a consistent approach, allowing developments already under construction to continue operating under the previous pre-sale rules, said Li Yujia, chief researcher at the Guangdong Housing Policy Research Center.

Shenzhen, like Shanghai, has left the treatment of such projects to further study by the relevant authorities, Li noted, adding that supporting measures have yet to be clarified.

Land Payment Rules Tightened

The rules also give developers more time to pay for land, but require full payment before they can begin pre-sales.

Shenzhen requires developers acquiring newly transferred residential land to make an initial payment of 50 percent of the land premium, with the balance generally due within one year. The payment period may be extended to two years for special projects.

Developers must pay the land premium in full before they can complete the initial land registration and obtain pre-sale permits for the first batch of homes.

Sun said that allowing land premiums to be paid in installments provides a buffer against tighter regulations and moderately eases developers' upfront financial burden.

Unlike Beijing, which allows land premiums to be paid over two years without directly linking payment to pre-sale eligibility, Shenzhen makes full payment a prerequisite for obtaining pre-sale permits, imposing stricter constraints to contain risks, she added.

Editor: Emmi Laine