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SHANGHAI - A third-tier city in eastern Anhui province has called an abrupt halt to a housing policy that was announced only last week.
The move indicates the central government's determination to keep house-price inflation in check, analysts said.
On Thursday, Wuhu government in Anhui province published a notice on "further improving the living conditions of local residents". In an obvious break from the State's tightening policies, the notice said home purchasers would receive subsidies for the whole year if their newly bought homes were less than 90 square meters in area.
New homes with a gross floor area of between 70 sq m and 90 sq m would garner a subsidy of 50 yuan ($8) per sq m, while new homes less than or equal to 70 sq m would see a subsidy of 150 yuan per sq m.
Furthermore, under the policy, buyers would also be exempt from paying the deed tax for home purchases.
Although the local government denied that the policy was aimed at bailing out the ailing property market, the move triggered wild debate over whether the nation's tightening property policies will be reversed.
However, just three days later, the Wuhu government announced on its website that the policy will "be suspended because related supporting rules are being studied and improved".
"The sudden halting of Wuhu's new policy is related to bad timing, especially after Premier Wen Jiabao recently reiterated the importance of cooling the property market," said Hui Jianqiang, research director of Beijing Zhongfangyanxie Technology Service Ltd, which provides information about the real estate market.
The central government has two goals for the current round of property tightening. One is to return house prices to a reasonable level, and the other is to promote the long-term, steady and sound development of the property market, said the premier at a meeting of the State Council, China's cabinet, in early February.
"Wuhu's short-lived housing policy shows the central government's resolution to eliminate any possibility of pushing property prices higher," said Song Huiyong, a research director with Shanghai Centaline Property Consultants Ltd.