BEIJING (Reuters – China’s conditions do not allow for the expansion of a property tax trial in this year. The state-run Xinhua news Agency quoted the Finance Ministry as saying Wednesday. These statements suggest that authorities are careful to preserve confidence in the sector.

China’s property market cooled last year after Beijing’s deleveraging campaign created a liquidity crisis for some of the largest property developers. This led to bond defaults, and unfinished projects.

Overall, demand for goods and services is slow but a variety of initiatives have been implemented to boost buying interest.

Official data from Wednesday revealed that February saw new home prices stagnate after they had risen a month before.

Yan Yuejin (research director, Shanghai-based Ehouse China Research and Development) said that the implementation of property taxes faces many difficulties, including macroeconomic pressures and downward force on the real estate markets.

Yan stated that Yan believes this move will reduce the concerns of homebuyers and was also beneficial to real estate firms.

Liu He (Chinese vice-premier) urged Wednesday’s government officials to implement market-friendly policies. He warned that they should not introduce any measures that might harm the markets and instead “cautiously”. He pledged that he would address risks within the property sector.

Premier Li Keqiang announced that China will adopt city-specific policies in order to support the health development of its property sector.

China began a property-tax pilot project in Shanghai, Chongqing and Chongqing back in 2011. But stakeholders and local governments which heavily depend on land sales for financing have been resistant to the notion of a second trial.

Although the parliament’s top decision-making authority stated in October that it would introduce a pilot tax on real estate in some areas, it did not specify the specific regions nor give any details.

A Reuters poll found that most analysts expect the property tax delay to be a result of a Reuters poll.

China left out a possible property tax at its annual meeting of parliament this month for the third straight year.