29/6/2018-6

Shi Yongqing assesses vacant taxes on housing problems and “mistakes"

The government is expected to explain the details of the vacancy tax this week. Shi Yongqing, chairman of the Central Plains Group, described this as the image of the government rather than the solution to the housing problem. Cai Hongxing, executive director and chief executive officer of Huasheng Group, said that the cost of vacant tax will be passed on to the public.

Cai Hongxing: Cost or transfer to the public

Cai Hongxing pointed out that real estate developers hope that if the goods are rotated, they will not hope to hoard the odds. The current vacancy rate of private buildings is only about 3.8%, which is a historical low. He clearly stated that if the government levies vacant taxes, developers may pass on the costs to future users. He also pointed out that at present, there are only about 9,000 vacant units. Even if a vacant tax is introduced, there will be no substantial increase in supply. If the Government is determined to increase the number of residential units and feels that the vacancy tax is effective, the vacancy tax should be expanded to second-hand buildings. Otherwise, it is to distort the free market.

Shi Yongqing further described that the government’s levy of vacant taxes to solve the housing problem is “the wrong way" and that the measures are only the image of the government. He pointed out that the effect of a vacant tax is to force property developers to “sell leftover cane", that is, to first look for poor units such as garbage rooms and cemeteries. However, they may choose not to sell unfinished uncompleted flats for the time being, eventually leading to an average property price. It fell, but the overall supply did not increase.

Liang Jichang, a member of the accounting department of the accounting profession, agrees that the collection of vacant taxes by means of income collection means that even if it is not always possible to curb property prices, they are responsible market behaviors, and nothing can be done.

As for the effectiveness, Liang Jichang said that recently real estate developers have launched vacant properties for a long time and the response has been enthusiastic. He also pointed out that the government may additionally consider increasing the vacant tax rate of the relevant units as the time for vacant units increases.