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Developers in rush to buy more land plots

REAL estate developers across the country have been rushing to acquire land because of the moderately loose lending policy at commercial banks and continuing booming home sales.

In terms of gross floor area, acquisitions of land for residential use totalled 19.7 million square meters in 10 major Chinese cities between April and June, a quarter-on-quarter increase of 360 percent, DTZ, a major real estate services provider, said yesterday in its latest market research.

"Developers are showing increasing interest in expanding their footprint over the past few months, particularly in the residential market," noted Alan Chiang, head of residential at DTZ China. "Nearly 60 percent of land sold within the period was for residential use, compared with only 20 percent in the first three months."

The China Index Academy, a real estate research institute, also revealed in its half-year report released yesterday that real estate developers had recently picked up their pace for land acquisitions.

Last month alone, more than 15 million square meters of plots were sold to developers in 60 Chinese cities, a month-on-month increase of 35 percent.

Robust sales of new homes, coupled with a surge of bank loans, remained the two driving forces behind developers' growing enthusiasm for land, industry analysts said.

Across the country, new homes totalling 314 million square meters were sold in the first six months, a year-on-year increase of 33 percent, according to the National Bureau of Statistics.

And in the 10 cities monitored by DTZ, about 54 million square meters of new houses were sold during the six-month period, a year-on-year growth of 85 percent.

Meanwhile, at China's commercial banks, money lent to real estate companies already exceeded 800 billion yuan in the first half of this year across the country, equivalent to 80 percent of the total loans received by developers last year, according to earlier government data.


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