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House prices still rising but cities see pace slow
By Jin Jing |
September 19, 2011, Monday
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Print Edition
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New home prices in major Chinese cities continued to rise in August compared to a year ago, the National Bureau of Statistics said yesterday. But more cities reported that increases were slowing as the government's tightening measures took effect.
All 70 cities monitored by the bureau saw prices of new homes rise from a year earlier with 25 reporting increases of 5 percent or more.
Nanchang, capital of Jiangxi Province in eastern China, reported the highest increase - 9.3 percent - followed by Urumqi in the Xinjiang Uygur Autonomous Region in the far west and Changsha in the central Hunan Province, which both reported 9 percent rises over August 2010.
But 40 cities reported that growth had narrowed from a year earlier, 14 more than in July.
The central government has launched a number of policies since last April to clamp down on property speculation and runaway prices, including refusing bank mortgages to buyers of three or more homes and imposing house purchase restrictions in major cities such as Shanghai and Beijing.
More second and third-tier cities are also being required to adopt stricter house purchase restrictions.
"The growth in August was the result of a few rounds of price surges over the past year," said Sky Xue, analyst from China Real Estate Information Corp.
Xue said the profit margins of real estate developers were averaging around 10 to 20 percent and a significant drop in the home prices would trigger an overall market collapse.
"Different from the public anticipation of a plunge in new home prices, government measures mainly aim to prevent the price from going up, he said. "From that point of view, tightening policies are working well."
Xue said he expected a year-on-year decline in house prices to be realized by the second quarter of next year.
The bureau's figures also showed that new home prices, excluding affordable housing, either fell or remained unchanged in 46 out of 70 cities across the country in August compared with July.
That compared with a drop or no change in 31 cities in July and 26 in June.
Eight cities reported a slowdown in price growth in August from a month earlier and among those cities which saw prices rise from July, growth was all within 0.4 percent.
Government data also showed that prices for existing homes either dropped or remained flat in 43 cities in August, nine more than in July.
On a year-on-year basis, prices fell in five cities in the existing home market, compared to four in July.
All 70 cities monitored by the bureau saw prices of new homes rise from a year earlier with 25 reporting increases of 5 percent or more.
Nanchang, capital of Jiangxi Province in eastern China, reported the highest increase - 9.3 percent - followed by Urumqi in the Xinjiang Uygur Autonomous Region in the far west and Changsha in the central Hunan Province, which both reported 9 percent rises over August 2010.
But 40 cities reported that growth had narrowed from a year earlier, 14 more than in July.
The central government has launched a number of policies since last April to clamp down on property speculation and runaway prices, including refusing bank mortgages to buyers of three or more homes and imposing house purchase restrictions in major cities such as Shanghai and Beijing.
More second and third-tier cities are also being required to adopt stricter house purchase restrictions.
"The growth in August was the result of a few rounds of price surges over the past year," said Sky Xue, analyst from China Real Estate Information Corp.
Xue said the profit margins of real estate developers were averaging around 10 to 20 percent and a significant drop in the home prices would trigger an overall market collapse.
"Different from the public anticipation of a plunge in new home prices, government measures mainly aim to prevent the price from going up, he said. "From that point of view, tightening policies are working well."
Xue said he expected a year-on-year decline in house prices to be realized by the second quarter of next year.
The bureau's figures also showed that new home prices, excluding affordable housing, either fell or remained unchanged in 46 out of 70 cities across the country in August compared with July.
That compared with a drop or no change in 31 cities in July and 26 in June.
Eight cities reported a slowdown in price growth in August from a month earlier and among those cities which saw prices rise from July, growth was all within 0.4 percent.
Government data also showed that prices for existing homes either dropped or remained flat in 43 cities in August, nine more than in July.
On a year-on-year basis, prices fell in five cities in the existing home market, compared to four in July.
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