The ministry of finance and the directorate-general of taxes issued a bulletin adjusting the value added tax policy for the sale of housing by individuals。
The new policy exempts individuals from vat if they purchase housing for a period of less than two years and pay full vat at a rate of 3 per cent; they buy for a period of more than two years (including two years)。
In line with the latest policy, it can be said that the 160,000 registered second-hand houses market in xi'an was injected with a strong dose, and the adjustment of the value-added tax policy opened a window for both buyers and sellers to simultaneously reduce costs。
- 01-
New deal interpretation
According to the latest bulletin issued by the ministry of finance and the national tax administration, from 1 january 2026, the value added tax policy for the sale of housing by individuals will introduce new standards。
Specifically, the rate of vat collection has been adjusted from the previous 5. 3 per cent to 3 per cent when individuals sell and buy housing for less than two years. For dwellings that have been purchased for two years (including two years), vat is exempt from sales。
The bulletin clearly states that this policy adjustment has been in effect since 1 january 2026. However, a transitional provision was added to the bulletin: by 1 january 2026, the value added tax (vat) associated with the sale of housing by individuals could be implemented in accordance with the new policy if it had not yet been declared and was in line with the new policy。
The core change in this adjustment compared to the current policy was the reduction of the vat rate for housing less than two years from 5. 3 per cent to 3 per cent and the clarification of the tax exemption for housing up to two years。
- 02-
What's the status of sean's second-hand house
The west ang's second-hand house market is now characterized by “price-for-price” prices. It is known that 160,349 sets of second-hand housing stock have been registered, an increase of 2533 over last month. This means that markets are well supplied and competitive。
According to statistics, in september 2025, 6857 second-hand dwellings were opened in the city of sian, a decrease of 8. 3 per cent over the same period. From january to september this year as a whole, 73049 second-hand homes were sold, an increase of 1 per cent over the previous year。
For the xi'an second house market, the adjustment of the vat policy will directly reduce transaction costs. In the case of a housing unit of $2 million for less than two years, the value added tax (vat) of approximately $106,000 had previously been paid, while only $60,000 was now paid, at a cost of $46,000。
Such a reduction would benefit both buyers and sellers. On the one hand, sellers can sell property for less than two years more easily; on the other hand, buyers can buy suitable housing at a more reasonable price。
The new policy will also promote “old for new” activities. In accordance with a number of measures to promote the smooth and healthy development of the real estate market issued by the city of sian in june 2025, the city has been promoting “old-for-new” housing activities。
By reducing the cost of selling old homes, more families will be able to successfully implement improved replacements。
- 03-
Combined effects of accompanying policies
In fact, a number of real estate support policies have recently been introduced. In addition to the adjustment of the vat policy, it has been optimized。
Recent adjustments in major real estate policy in the region
:: value added tax policy
• before adjustment: exemption for 2 years; collection for less than 2 years at 5. 3 per cent
:: adjusted: 2 years of exemption; 3 per cent collection for less than 2 years
:: tax incentives
:: pre-adjustment: 90 m2 and 1 per cent of the first suite below
• adjusted: 140 m2 and up to 1 per cent
• tax refunds for “old for new” taxes
• specific content: purchase of a new home within one year of sale, and application for tax refund paid
The city of xi'an is also promoting the development of a second-hand housing market, speeding up the processing of real estate titles for housing stock, leading to a reduction in the cost of intermediary services and improving the procedures for “hand-on transfer”. These measures form a policy mix with vat adjustments to reduce transaction costs。
- 04-
Market outlook and response recommendations
Looking ahead, the xi'an second-hand house market will be gradually rehabilitated, and in 2025 the si'an second-hand house market as a whole was “unbalanced supply and demand, slowing down the pace of trade”。
As policy effects emerge, market dynamism is expected to increase. In particular, after the new deal was formally launched in 2026, the mobility of the housing stock will improve in less than two years, contributing to an overall upturn in transactions。
For both buyers and sellers, a different strategy is essential in the current sian second house market。
For sellers, especially owners who hold a home for less than two years, consideration could be given to trading after the new deal of 2026 to cover lower vat costs. The bargaining space in the market has now risen to 10. 53 per cent, a new high since 2023. It is recommended that owners reduce their psychological expectations appropriately and accelerate sales at reasonable prices in order to replace better-quality properties。
For buyers, there is currently a window period of choice and bargaining power. Buyers can focus on new housing sources for less than two years, which are usually of better quality and have significantly reduced transaction costs after the new deal. At the same time, greater bargaining space could be sought, taking advantage of the current buyer market。
At the end
With the official launch of the new deal on 1 january 2026, more than 160,000 sets of second-hand registered rooms in xi'an or new opportunities for mobility will be opened. The ice between buyers and sellers is gradually melting with the warm winds of policy。
