By NIU Yu

Suzhou is to buy 10,000 new houses to support real estate prices, according to the minutes of a meeting that have been circulating online this week. 

A source said the government had already bought 2,500 units in September to use as subsidized housing. For the next batch, the government will pick up the tab for the 30 percent down payment. 

Last month 1.2 million square meters of housing were sold in Suzhou, up significantly from the previous month.

Similar measures have been proposed or implemented in other places. In Zhengzhou, a state-owned developer has promised to buy up houses that private developers cannot sell and make them affordable rentals. This will provide much-needed cash for developers struggling to deliver presold units. Handan and Huzhou have also asked state-backed companies to buy the excess inventory to use as subsidized housing for their employees or low-income families.

In some cases, the purchases are part of urban development projects. Zhaotong in Yunnan Province asked district-level governments to buy houses for people moving out of old neighborhoods that are being rebuilt. Guilin recently paid developers 267 million yuan (US$35 million) to build homes for residents being relocated from a tourist site. Wuhan set aside 200 units at a planned winter sports venue for those living on the appropriated land. The government often pays below market rates. 

Government agencies have also offered their employees "group purchase" deals for houses in remote areas. Many were built during the real estate boom and are having a hard time finding buyers in a cooling market.