Shanghai may tax speculative property owners

The city government of Shanghai is likely to tax investors owning more than one property, reported the South China Morning Post. The government has already completed the basic outline of the tax, which will target speculative investors who own multiple luxury properties that they are using to bet on capital appreciation. With Shanghai’s residential real estate prices growing 60% in 2009, there has been rising concern that property speculation is squeezing the middle class out of home ownership. The government of Chongqing recently announced a similar plan to curb speculation. Previous measures, including the reintroduction of a 5.5% business tax on second homes that are resold within five years, have so far failed to put a serious dent in property prices.