Shanghai and several other Chinese cities have moved to restrict home purchases in a bid to deflate bubbles in the real estate market.
The rules, which were revealed by Shanghai's Housing Guarantee and Administration Bureau on Saturday, prohibits new home purchases from locally-registered families who have owned two or more homes and non-local registered families who have owned at least one home.
Additionally, non-Shanghai registered families who have no documents certifying they have paid for social security or income tax in the city for one year are banned from buying property.
Sales of commercial homes fell 42.4 percent year on year in Shanghai in 2010 as earlier measures to curb the speculative demand in the real estate market took effect.
Despite the fall in sales volume, the average price of new commercial homes rose by 7.6 percent to 20,995 yuan (3,200 U.S. dollars) per square meter last year.
On the same day, authorities in the eastern city of Nanjing and the northeastern city of Harbin rolled out similar purchase restrictions.
On Wednesday, the Beijing municipal government unveiled even tougher measures to prohibit home purchases from non-local registered families who have no proof of social security or income tax payments in the Chinese capital for five straight years.
The purchase limits came after the State Council, China's Cabinet, ordered late last month that cities where home prices are skyrocketing must implement strict measures to restrict home purchases over a period of time.
The State Council also said that local governments will be responsible for the stable and healthy growth of property markets and are required to publicize, before the end of March, the annual "controlled" price targets for new homes.
China has implemented a series of measures since last year, which includes higher down payment and lending rates, and bans on mortgage loans for third homes, to rein in the rapid rise in housing prices.
Soaring prices have become a major concern for urban Chinese residents as more homes turn unaffordable. In fact, home prices in some major cities such as Beijing have more than doubled over the past two years.