Tuesday, 16 September 2008

Mainland property developers are expected to be under pressure to cut home prices

More in comments...

1 comment:

Guanyu said...

Mainland property developers are expected to be under pressure to cut home prices to boost sales volume in the peak season. “The mainland property market is not likely to see a turnaround yet since the market has just started to experience a substantial fall in prices,” said Woody Lam, managing director for Southern China at Savills. He said prices in the mainland residential market would fall 15 to 20 percent by the end of the year. Home prices have persistently grown throughout the year despite recent reductions. Morgan Stanley analyst Jerry Lou said prices and volume would fall in deep scale. “We believe the likelihood of a property sector meltdown is high. The impact on banks’ earnings may be substantial,” he said. Agile Property Holdings (3383) has cut average selling prices by 10 to 15 percent in the first half to about 7,000 yuan (HK$7,965) per square meter. China Vanke, the largest listed property developer in the mainland, has cut prices between 25 to 30 percent and rejected demands from buyers for refunds or compensation on homes bought before its last price cut in late August.