According to The Australian Financial Review today, China has moved to boost its weak housing market by cutting taxes and lowering down payment requirements, as the world's second biggest economy rolls out a series of measures to stimulate growth.
In an announcement that has been expected for some time, the minimum down-payment on a second home has been cut to 40 per cent from 60 per cent previously.
In addition, those selling a property they have owned for at least two years will no longer be required to pay taxes, while restrictions on using retirement savings to buy an apartment have also been eased.
"The housing market correction continues to be seen as one of the key drags on domestic demand growth for 2015," says J.P. Morgan's China economist Zhu Haibin.
The down-turn has been the key drag on the iron ore price which has fallen to a seven year low of $US53 a tonne. Any turn-around in the housing market should increase demand for the key steel making commodity.
In the first two months of the year the total area of residential property sold declined by nearly 18 per cent, compared to the same time in 2014. The area of new apartments under construction has fallen by nearly 20 per cent over the same period.
Expectations that housing restrictions would be eased pushed China shares up nearly 2 per cent on Monday to a seven year high.