• Tuesday, October 06, 2015

Chinese housing prices defy taming measures in 65 of 70 cities

Staff Reporter 2013-02-07 15:29 (GMT+8)
A residential area in Guangxi. (Photo/Xinhua)

A residential area in Guangxi. (Photo/Xinhua)

Although the Chinese government unveiled a series of measures in 2010 to control skyrocketing housing prices, the average costs of newly built commercial residences in 70 leading cities had risen by 4.1%, on average, in the two years prior to the end of 2012, according to the Shanghai-based National Business Daily.

Citing statistics compiled by E-house China R&D Institute, the newspaper reported that 65 of the 70 cities recorded a rise in housing prices, while only five saw a decline.

Zheng Hongyu, an analyst with E-house China, told the National Business Daily that the price rise has been stronger in western and central Chinese cities, where residents purchase houses mainly for their own use and are therefore not deterred by anti-speculation measures.

In several third-tier cities, such as Changzhou in Jiangsu province and Yingkou in Liaoning province, housing prices have been driven down by a heavy inventory of unsold apartments, said Zheng.

Further, since the second half of 2012, the housing price index compiled by the National Bureau of Statistics moved up for seven consecutive months, which suggested that housing prices might rise again in 2013.

Compared with 2010, the index in the first-, second- and third-tier cities had increased by 4.6%, 4.57% and 3.67%, respectively.

Given the fact that first-tier cities have seen the most gain, Zheng cautioned that housing prices might spin out of control unless authorities act to take control with new measures.

Although many analysts shared Zheng's view that housing prices are rising across the country, five cities have bucked the trend by showing a drop in prices, and all of them, except Qingdao in Shandong province, are located in Zhejiang province.

The four Zhejiang cities, Wenzhou, Hangzhou, Ningbo and Jinhua, recorded a sharper slide than the 0.2% dip in Qingdao.

Wenzhou, however, led all cities with a fall of 17.7% in housing prices.

Zheng attributed this to Wenzhou's extraordinary housing price rise in 2009, brought on by speculative purchases. Wenzhou's real estate property market began a slide in 2010 when speculators departed after local authorities imposed restrictions on the purchase of houses.

Another reason for the decline was that Zhejiang had enforced restrictions more thoroughly than other provinces, as eight of its ten provincial cities had imposed some level of restrictions on the purchases of houses, said Zheng.

Who`s who »
Jason Hu (胡志強)

Jason Hu is the former Kuomintang mayor of Taichung who became vice chair of the Want Want China Times Group on Feb. 1, 2015. Hu served as mayor of Taichung between 2001 and 2014 and vice chair of ...