(Yicai Global) May 23 -- Wuhan’s economic development zone and other districts of the central Chinese city have lifted restrictions on home purchases to stimulate local real estate transactions, a senior local government official confirmed to Yicai Global.

The zone posted a notice on its Weibo account early yesterday morning that all restrictions on home buying in the area would be removed, but soon deleted it without any explanation.

A local real estate agent also confirmed to Yical Global that the move is real. “In the city’s housing purchase qualification inquiry system, Wuhan’s economic development zone has already disappeared from the column labeled ‘Areas With Housing Purchase Restrictions.’

“Real estate developers have told agents to accept home purchase applications by people who were restricted to buy houses,” the agent added.

Besides the economic development zone, the city’s Dongxihu, Huangpi and Jiangxia districts have also been removed from the category of areas with buying curbs.

“As nearly 100 cities nationwide have relaxed their respective policies to stabilize the real estate market, Wuhan easing its policies is no surprise,” Li Guozheng, director of the Central China Market Research Center of the China Index Academy said in an interview with Yicai Global.

Lower mortgage rates is not enough to stabilize property market expectations when the economy is weak, Li said, predicting Wuhan will decide future policies based on the market situation after this latest move and may come out with more measures.

Wuhan’s economic development zone sold only 219 newly-built apartments last month, so supply and demand is unbalanced, adding pressure to reduce excessive real estate stock, according to data from the city’s housing bureau.

New home sales in Wuhan have plummeted this year. According to the data, sales fell 47 percent to 36,639 from January to last month, representing a little over 4 million square meters.

Wuhan’s housing sales cycle was 12.9 months at of the end of April, and 17.4 months on average in new urban districts, so the pressure is great even in areas with no restrictions on housing purchases such as Hannan and Xinzhou districts, per figures monitored by the China Index Academy.

Editor: Tang Shihua