Hainan looks to Property Vacancy Tax to fill up empty apartments
The popular Chinese tourist island of Hainan may introduce a property vacancy tax as vacancy rate reaches as high as 90 percent, harming the interests of local residents, according to local political advisors.
"When developers buy land plots in Hainan, they are targeting high-end, cash-rich buyers from outside the province, and more than 80 percent of the local residential homes are sold to non-locals, which is why the vacancy rate is so high there,” Dai Hong, a member of the Chinese People's Political Consultative Conference Hainan Committee, said at the committee’s annual plenary meeting on Saturday.
Dai suggested that the government tax a residential home if it remains vacant for 2 years or longer, with the tax to be assessed annually at a rate of 1 percent of the standard value of the building and increase year by year.
"Apart from the fact that vacant homes are a waste of land resources and public services, they pose a threat to the all-around and sustainable development of Hainan province as an international tourism destination," said Wang Yiwu, another member of the committee attending the Feb.11. meeting.
Wang suggested the local government place a tax on homes with high vacancy rates to crack down on speculative buying, and at the same time build more public rental apartments to accommodate low and middle-income families.
Hainan aims to build 75,500 social housing units this year, acting governor Jiang Dingzhi said in a work report delivered on Feb. 9.
The average price of a home in Haikou, Hainan's capital, inched up 0.35 percent month-on-month in January to 6,884 per square meter. That compares with a 0.18 percent drop in the average price of a home in 100 Chinese cities monitored by the China Index Academy to 8,793 yuan per square meter.
Sanya, a popular resort city in the province, saw the average home price fall 0.23 month-on-month from December, but prices remained at more than double the national average — at 19,074 yuan per square meter — according to the academy's data.