Up until now there has not been any sort of annual property tax on housing so there was no annual cost (beyond a loan) to owning a home. IF this proposal becomes law I predict a massive change in the perception of housing in China as well as a large number of 2nd (and 3rd, 4th, 5th?) homes behind dumped on the market.
May 12 - China Daily
Shanghai will reveal the details of its tightening real estate policies as early as the end of this month, including its long-debated property-ownership tax on multiple homes, Shanghai Securities News reported today.
The property ownership tax is a tax on property based on its ownership and is usually charged yearly based on the estimated value or rental income of the property. In China, the tax currently targets only commercial properties.
In the draft plan, Shanghai will say that multiple residential properties owned by one household will be regarded as commercial properties, and thus subject to property ownership tax, the paper reported.
[edit: It looks like this will not happen, look at a more recent post of mine for the details. ]