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House prices remain high amid low sales
By Cao Qian |
June 4, 2010, Friday
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Online Edition
Online Edition
SHANGHAI'S house price index maintained its upward trend in May but might be close to its peak as monthly growth fell by 0.15 percent.
The index, which tracks price fluctuations of existing homes across the city, climbed 4 points to 2,582, extending gains for the 14th consecutive month. It rose 0.69 percent in April and 0.81 percent in March.
"Transaction volume of existing homes plunged more than 60 percent in May across the city, with mid- to low-end homes being more severely affected compared to high-end houses," said Tao Ting, an analyst with the index compiler, Shanghai Existing House Index Office. "That helped explain why the index still managed to increase, though very slightly."
The prices of existing homes in five downtown districts climbed an average 0.5 percent last month, compared with 0.97 percent in April. In outlying areas of the city, home prices dropped an average 1.02 percent from a month earlier, the compiler said.
Across the city, 51 of the 68 areas monitored by the compiler saw price gains last month while 17 areas posted price falls.
Posting the biggest monthly increase in prices in May were areas around the City God Temple with 2.08 percent, Zhongshan Park with 1.56 percent as well as North Sichuan Road with 1.43 percent.
China has unveiled several tightening steps since mid-April to rein in property speculation. The moves, which include higher down-payments and mortgage rates for second homes, have curbed buyers across the country, affecting both new and existing markets.
"Home transaction volume won't likely encounter a notable rebound in the city until detailed local guidelines are disclosed," Tao said.
Cities including Beijing, Guangzhou and Shenzhen all released their guidelines to help the implementation of central government policies while Shanghai is still working on a scheme.
The index, which tracks price fluctuations of existing homes across the city, climbed 4 points to 2,582, extending gains for the 14th consecutive month. It rose 0.69 percent in April and 0.81 percent in March.
"Transaction volume of existing homes plunged more than 60 percent in May across the city, with mid- to low-end homes being more severely affected compared to high-end houses," said Tao Ting, an analyst with the index compiler, Shanghai Existing House Index Office. "That helped explain why the index still managed to increase, though very slightly."
The prices of existing homes in five downtown districts climbed an average 0.5 percent last month, compared with 0.97 percent in April. In outlying areas of the city, home prices dropped an average 1.02 percent from a month earlier, the compiler said.
Across the city, 51 of the 68 areas monitored by the compiler saw price gains last month while 17 areas posted price falls.
Posting the biggest monthly increase in prices in May were areas around the City God Temple with 2.08 percent, Zhongshan Park with 1.56 percent as well as North Sichuan Road with 1.43 percent.
China has unveiled several tightening steps since mid-April to rein in property speculation. The moves, which include higher down-payments and mortgage rates for second homes, have curbed buyers across the country, affecting both new and existing markets.
"Home transaction volume won't likely encounter a notable rebound in the city until detailed local guidelines are disclosed," Tao said.
Cities including Beijing, Guangzhou and Shenzhen all released their guidelines to help the implementation of central government policies while Shanghai is still working on a scheme.
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