It was said that one of the purposes to oust Chen Liangyu was to cool Shanghai’s economy, particularly the real estate sector.
According to Apple Daily, echoing the central government’s policy of tightening the property market, local governments one after another released news about declining property prices.
Shanghai’s property prices, which have been at their highest for a long time, also reportedly slumped. However, that was just manufactured news, specifically tailored to the demands of the central government.
Along the round road in Pudong district, prices of some new apartments were proposed as 8,000 yuan per square meter, but the real prices were over 12,000 yuan. Buyers have to cooperate with sellers to “make prices”. For example, if a buyer wants to purchase an apartment with the real price of 950,000 yuan, he can get a 20,000-yuan discount if the buyer agrees to forge a 700,000-yuan selling price on the contract, while he pays 930,000 yuan in practice.
This tactic helps both the buyer and the seller reduce tax payments. More important, it makes the local government happy, because it “successfully” lowers the price of an originally 950,000-yuan apartment to 700,000 yuan.
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