(Yicai) Oct. 16 -- Hangzhou is removing restrictions on buying no more than two apartments across the city, except in four core districts. The move is likely to lead to a peak in real estate sales at the end of the year, an expert said.

People can now purchase as many properties as they want in the municipality in eastern Zhejiang province, with the exception of Shangcheng, Gongshu, Xihu and Binjiang districts where the limit remains, according to a document released by the city's bureau for housing guarantee and real estate management today.

This, together with previous moves to reduce mortgage rates, will help boost demand for properties and a small peak in transactions is expected in the last two to three months of the year, Zhang Hongwei, founder of a consulting firm in Shanghai, told Yicai.

In addition, people who do not hold a Hangzhou resident’s permit will be allowed to buy one property in the four core districts based on their social security and personal income tax payments to the local government, the document said. In the past, those without a Hangzhou hukou had to pay social security premiums in the city for 12 months in a row in order to qualify to purchase housing.

The lifting of the curbs might have to do with tumbling prices. Last month, new apartment sales in Hangzhou climbed 8 percent from the previous month to 7,414 units, but the average transaction price sank 12 percent to CNY29,046 (USD4,006) per square meter, according to data from think tank China Real Estate Information Corp.

Hangzhou is also lowering the threshold for developers to participate in land auctions by allowing them to use bank letters of guarantee as collateral. This will encourage more firms to sign up for auctions which will boost the land market, Zhang said.

Editors: Dou Shicong, Kim Taylor