Feb 8, 2012
Translated by Zhu Na

Source: The Economic Observer

Land transfer fees shrank significantly in January, the Securities Times reported, as year-old restrictions on real estate sales eat into cities' fiscal revenue.

Anticipating the shrinkage of one of their major sources of funding, Beijing and Shanghai have already taken the lead by budgeting for lower land revenue than in 2011.

The most recent data from the China Index Academy shows that revenue from land transfer fees in 300 cities during January was 89.59 billion yuan, down 67 percent from the same month in 2011, with 53.24 billion yuan raised from selling long-term leases for residential construction and 22.24 billion yuan paid for the right to use the land for commercial use.  

The decline in revenue from developers of residential projects was steeper than the fall in takings from commercial projects, with each reaching 74 percent and 53 percent respectively.

Wuhan, the capital of Hubei Province, raised far more than any other city from land transfers, and was the only one where the sales generated more than ten billion yuan. All the other cities took between two and four billion yuan, far less than in Jan 2011, with Suzhou’s takings totaling only 10 percent of 2011's amount.

Shanghai came in just behind Wuhan in the ranking, raising 3.76 billion yuan, but this was still 75 percent less than in January 2011.

Beijing took 2.19 billion yuan, a decline of 64 percent.

According to the data from the Beijing Finance Bureau, the city is expecting 90 billion yuan in 2012 from the sale of land transfer rights, a reduction of 30 percent from 2011. Shanghai Finance Bureau is expecting 125 billion yuan, 16 percent less than in 2011.

Links and Sources
The Economic Observer Spending Proceeds of Land Sales
Securities Times  1月全國300城市土地出讓金同比縮水近七成

 
This translation was edited by Will Bland.