(Yicai Global) March 24 -- Harbin, the capital of China’s Heilongjiang province, has further loosened the constraints on its real estate market after house prices in the northeastern city dropped for the seventh consecutive month in February.

Harbin will also eliminate the rule that forbids new owners from selling homes within three years of their purchase, the city’s authorities said yesterday.

House prices in the city fell from last August through last month, according to data from the National Bureau of Statistics. The average price of a lived-in property fell 4.9 percent to CNY9,515 (USD1,495) per square meter this month from a year earlier, and some properties in the suburbs were priced at less than CNY100,000 (USD15,700) per sqm, figures from real estate data provider Anjuke showed.

Harbin has eased curbs on its property market, including the requirements for provident fund loans, and issued subsidies for home purchases a number of times since the fourth quarter of last year, but the market still remains weak.

The city has relaxed all the policies it could, said Yu Xiaoyu, research director at EH Consulting, adding that the real estate consultancy expects other second-tier cities in Heilongjiang province to follow suit.

The main factor that tipped Harbin’s real estate market into decline is the imbalance between supply and demand, according to a report released by Tospur Real Estate Consulting. The city’s annual average supply of housing has stood at about 8.5 million sqm over the past five years, while the annual average sales were just 7 million sqm. Covid-19 also has been a factor.

Harbin introduced property market restrictions in 2018 to curb house price gains. Four years ago, the city tightened requirements for provident fund loans and raised the down payment and mortgage rate for people buying a second home to choke off demand for investment and speculative house purchases.

Editors: Zhang Yushuo, Futura Costaglione