(Yicai Global) Oct. 11 -- Northeastern China's Harbin has started giving subsidies to house buyers to control the dropping prices amid a shrinking population.

One of the city's freshly introduced real estate policies includes granting a one-time subsidy to eligible house purchasers till Dec. 31, 2022, Harbin Daily reported yesterday.

The new policies, including lowering the threshold so that applicants can buy older secondhand property by using housing fund loans, target consumption, said Yan Yuejin, research director at E-house China Research and Development Institution. The measures can reduce buyers' costs and should help encourage residents to take action in the favorable fiscal and taxation environment, he added.

The municipality is becoming less crowded. Among China's provincial capitals, Harbin is the only one that has been witnessing a decrease in total permanent population over the last decade, down by 626,000 people. However, the region's urban population is still growing at 5.5 million. Harbin is one of China's 14 cities which accommodate between five and 10 million people in urban areas.

Meanwhile, home prices have been declining in the city known for its annual ice and snow festival. In August, new houses in Harbin became 0.6 percent more affordable from a year ago, according to the National Bureau of Statistics. Prices had dropped 0.3 percent from a month earlier.

Destocking pressures are even bigger in other Chinese cities, including non-core second-tier cities and some third and fourth-tier cities in central and western China, so they are predicted to follow suit and debut new policies to mitigate local property firms' operational pressures, Yan suggested.

The overheated property markets in some Chinese cities are cooling while real estate firms' financial risks are becoming prominent, said Yan. Introducing policies to stabilize expectations should promote transactions, he added.

To be qualified for the subsidy, residents in Harbin need to be employed and have a six-month track record of social security payments in the city. Moreover, those who are aged under 35 and have started their own business can apply.

For each full-time Ph.D. student, the subsidy is CNY100,000 (USD15,537). Each full-time postgraduate student can receive CNY50,000 (USD7,769) and each full-time undergraduate may be offered CNY30,000 to buy a house. Other types of students, including those of junior colleges, can receive CNY20,000.

Editors: Liao Shumin, Emmi Laine, Xiao Yi