Xiongan New Area's real estate control

All housing sales departments and real estate agencies have had their operations suspended for the time in Xiong'an.[Photo: finance.sina.com.cn]

Local authorities in Hebei are taking steps to try to prevent fraud and regulate construction projects around the Xiong'an region, which has been tapped as the next major development area of China.

Much like when a listed company on a stock exchange has major news, and its trading is suspended for a time, so too have authorities around Xiong'an when it comes to the local real estate sector.

All housing sales departments and real estate agencies have had their operations suspended for the time in Xiong'an.

Pan Jinlin, deputy head of the Housing and Urban-Rural Construction Bureau of Anxin County, which is home to Xiong'an, is warning people to remember this, as there are actually no sales allowed in the local real estate market at the moment.

"Now we have frozen all the information on real estate. It means that people who really want to buy houses and house speculators can't find any information. There are almost no houses here which will be able to give buyers all the five papers required. No one is allowed to transfer the ownership of their houses sold after April 1, and so buying a house in private is only going to be a problem for buyers."

The local real estate market in Xiong'an has been shuttered as of April 1st, when the Chinese government announced the plan to establish the Xiong'an New Area.

It's going to have a national-level significance, similar to the Shenzhen Special Economic Zone and the Shanghai Pudong New Area.

Anyone found accepting down payments or holding payments for homes without the five permits required will face sanctions.

Any homes purchased in Xiong'an for the time being won't be protected by the law.

As of Friday, authorities in the Xiong'an New Area have investigated and dealt with 765 illegal real estate transactions and construction issues, detaining seven suspects, and closing 71 estate sales departments and 35 housing agencies.

Song Yongliang, deputy county chief of the Rongcheng County Committee, says the crackdown continues.

"Next we will continue to strengthen real estate controls and crack down on illegally-run real estate agencies to guarantee the stability and order of the housing market."

Liu Baoling, director of the preparatory committee of the Xiongan New Area, says maintaining property prices will be key to building-up the new area.

"The prices of house and land are the keystone of building the new area. They will lead to a lot of trouble if housing issues are left unchecked. For example, if the house and land prices are too high, the construction costs will increase, the construction speed of the new area will slow down, and even the quality of the new area will be badly affected. Finally, they will affect the benefits of the whole society and common people."

The Xiong'an New Area, about 100 km southwest of downtown Beijing, will span three counties that sit at the center of the triangular area formed by Beijing, Tianjin, and Hebei's provincial capital Shijiazhuang.

It's being set up to absorb some of the government departments from Beijing that are not necessarily needed in the capital.

It's also a testing ground to help restructure the urban layout in the Beijing-Tianjin-Hebei region.