What benefits does the new policy bring for homebuyers? How will it impact market trends? Experts interpret Shanghai’s "New Seven Measures" for the real estate market.

February 25, five departments including the Shanghai Municipal Housing and Urban-Rural Development Committee and the Municipal Housing Administration jointly issued the "Notice on Further Optimizing and Adjusting Local Real Estate Policies" (hereinafter referred to as the "Notice"), which includes **seven policies in three aspects: reducing housing purchase restrictions, optimizing housing provident fund loans, and improving personal property tax.** What benefits does the introduction of these "New Seven Policies" bring to home buyers? What impact will it have on the future trend of Shanghai's property market? On February 25, in response to concerns from citizens, The Paper interviewed many industry experts to interpret the new policy, analyze its impact, and predict future market trends. ## Lowering the Housing Purchase Threshold, Supporting Stable Resident Groups’ Housing Needs To serve livable and comfortable living, promote balance between work and residence, and focus on meeting residents' reasonable housing demand, the "Notice" clearly states further reductions in housing purchase restrictions: **First, shorten the period of social insurance or individual income tax payment required for non-local residents to buy housing within the Outer Ring; second, eligible non-local residents may purchase one additional home within the Outer Ring; third, non-local residents holding a Shanghai Residence Permit for 5 years or more may purchase one home within the city, with no need to provide proof of social insurance or tax payment.** According to the new policy, non-local residents who have paid social insurance or personal income tax continuously in Shanghai for at least one year before the home purchase can buy an unlimited number of houses outside the Outer Ring, and are limited to one house within the Outer Ring; those who have paid for three years or more can buy two houses within the Outer Ring. Non-local residents with a Shanghai Residence Permit for 5 years or more are restricted to one home across the city. "From the perspective of housing purchase restriction adjustments, the new policy lowers the purchase threshold and increases the number of homes that can be purchased," said Yan Yuejin, Deputy Director of the E-House Research Institute of Shanghai. The policy shortens the social insurance requirement for non-local residents purchasing homes within the Outer Ring to one year, while for families with three years of social insurance, they can buy two homes within the Outer Ring. This indicates the threshold for non-local residents to buy homes in Shanghai is further lowered, and the waiting costs are decreasing. At the same time, the new policy also supports housing demand among stable resident groups. Prior to the adjustment, people engaged in urban basic services or those whose companies are headquartered outside Shanghai often lacked purchase qualifications due to not paying social insurance in Shanghai. The "New Seven Policies" focus on supporting the housing needs of those stably residing in Shanghai, allowing those holding a residence permit for five years to qualify for buying a home. "In other words, previously the restriction depended mainly on the length of social insurance payment, but now it can also be tied to the length of holding a residence permit," said Yan Yuejin. Lu Wenxi, an analyst at Shanghai Centaline Property, believes that the optimization of purchase restrictions in the new policy further expands coverage, meeting diverse rigid and improved needs. **"Now, with only one year of social insurance, you can buy at least one home, without distinguishing between areas inside and outside the Outer Ring,"** he told the reporter. Currently, mid-to-high-end improvement demand is quite prominent, especially for new homes and those in desirable locations; the policy releases these buyers’ demand precisely. Moreover, for non-local residents with three years of social insurance, previously improving housing conditions usually required selling before buying, now they can buy first and sell later, or even directly buy a second home. ## Housing Provident Fund Loans: "Recognize House, Not Loan," Lowering Loan Costs To further leverage the role of the housing provident fund in supporting housing consumption, and to meet the livable needs of contributors at different stages, the "Notice" also optimizes the housing provident fund policy: **First, appropriately increase the maximum loan limit for housing provident fund; second, optimize the identification of loan count; third, expand the scope of support for families with multiple children buying homes.** In terms of loan limits, the new policy states the maximum provident fund loan for families buying their first home is raised from 1.6 million yuan to 2.4 million yuan; combined with the preferential policies for multi-child families and green building purchases (max increase of 35%), the maximum family loan limit can reach 3.24 million yuan. The maximum loan limit for purchasing a second home is also increased accordingly. Lu Wenxi analyzed that raising the provident fund loan limit allows buyers to benefit from lower interest rates, reducing their loan costs. "Currently, provident fund rates are much lower than commercial loans; borrowing more from the provident fund helps ease loan pressure," he said, especially for buyers with rigid demand, who usually buy 'entry-level houses' priced below 3 million yuan—now with the provident fund loan limit raised to 2.4 million yuan, it can fully meet these buyers’ loan needs. With additional incentives for multi-child families and green buildings, the maximum loan limit can reach 3.24 million yuan, significantly reducing monthly payment pressure and total interest. However, the actual loan limit depends on the buyer's provident fund account balance and other factors. Regarding the recognition of loan count, the new policy states that city contributors who have previously used provident fund loans, but have no housing or only one property and have settled their provident fund loans, may apply for a new loan when purchasing again. "This shows Shanghai’s provident fund loan conditions have been further relaxed, implementing 'recognize house, not loan'," said Yan Yuejin. Previously, if a buyer had already used the provident fund loan twice, subsequent purchases would not be eligible for any provident fund loans. After the new policy, as long as there is no house or only one house and the previous loan is settled, buyers are still entitled to a provident fund loan. "This allows more families upgrading homes to receive provident fund loan support, promoting the release of improvement housing demand," he said. The new policy also expands the applicability of multi-child family loan support to purchases of a second home, i.e., for multi-child families buying a second home, the maximum loan limit will increase by 20% on top of the city's maximum. "Second homes are now treated similarly to first homes; the new provident fund policy will cover more improvement families and further release diverse demand," said Lu Wenxi. ## More Humanized Personal Property Tax Policy, Reducing Related Groups’ Holding Costs To support residents’ needs for upgrading and improving housing, the "Notice" specifies that starting January 1, 2026, **for city resident families whose children, after reaching adulthood, purchase a home that is their only property, individual property tax will be temporarily waived.** That is, if the buyer co-owns housing with parents or (grand)parents as a minor (or before the pilot of the individual housing property tax in the city), and after purchasing or replacing a home, the new property remains the only property of the adult child’s family (other than the aforementioned co-owned home), then individual housing property tax will be temporarily waived. "Individual housing property tax is now more humanized," said Lu Wenxi. Previously, some buyers had to pay property tax after their children bought homes as adults, even though it was their only property, which affected demand release. The policy addresses such real-life issues, reduces concerns and holding costs for related groups. ## Will Further Release Reasonable Demand, Consolidate Stable and Positive Market Trend What impact will the new policy have on the subsequent market trend? Yan Yuejin believes the "New Seven Policies" fully reflect Shanghai's comprehensive and city-specific approach to policymaking and its use of both stock and incremental policy integration effects, with broad benefits and precise implementation. Overall, it demonstrates expanded support for various housing needs, especially balance between work and residence, livable conditions, and rigid/improvement demand. While continuing to reduce purchase costs, it will further promote the active release of housing consumption and balance supply and demand, consolidating the current stable and positive trend in the property market. "Considering that the market correction is basically done, expectations of stabilized prices are strengthening, and multiple positive policies are being layered, we believe that while boosting activity in various submarkets, the new policy will also promote healthy circulation and development between markets, especially facilitating smooth upgrade chains," said Yan Yuejin. For example, non-local residents now only need one year of social insurance to buy homes within the Outer Ring, so market entry pace is expected to accelerate. "If they buy a second-hand home, this will encourage sellers to list their properties and upgrade, thus also facilitating new home inventory reduction. Accordingly, a more positive and interactive circulation mechanism will form between markets, strongly promoting stable and healthy development of the real estate sector." In Lu Wenxi’s view, the introduction of the new policy will further release reasonable housing demand and promote a more stable trend throughout Shanghai’s property market this year. "I think Shanghai's property market had a promising start this year. Combined with earlier pilot programs for resettlement housing vouchers, measures for SOEs to buy second-hand homes, and other initiatives, the subsequent trend will be more solid. The steady release of transaction volume will help prices quickly bottom out," he said, and orderly and stable policy implementation will further strengthen the favorable market trend, helping the property market accelerate its stable and healthy development. **Source:** [The Paper](https://baijiahao.baidu.com/s?id=1858086389440475769) **Risk Warning and Disclaimer** The market is risky, and investment should be cautious. This article does not constitute personal investment advice and does not take into account any individual user's specific investment objectives, financial situation, or needs. Users should consider whether any opinions, views, or conclusions in this article are suitable for their particular circumstances. Investments based on this article are at your own risk.