When someone shares with you something of value, you have an obligation to share it with others.
Monday 8 June 2009
Key southern cities leading property sales rally
The three cities that led the downturn in the mainland property market last year - Shenzhen, Guangzhou, and Xiamen - are now leading the recovery in the market, analysts say.
The three cities that led the downturn in the mainland property market last year - Shenzhen, Guangzhou, and Xiamen - are now leading the recovery in the market, analysts say.
The three leading southern China cities recorded the biggest drops in property prices - an average of 36 per cent - in the country last year after Beijing imposed measures aimed at cooling the overheated market.
But buyers were now returning after the government reversed the measures and banks relaxed housing loan conditions, said Alan Chiang Sheung-lai, the head of residential property at property consultant DTZ.
As a result, prices had recovered or stabilised, though developers were unlikely to jeopardise the recovery by trying to raise prices further in the second half of the year, he said.
In Shenzhen, residential sales had risen in the first four months of the year to a monthly average of about 594,000 square metres, 82 per cent greater than the average monthly sales for the same period last year and 37 per cent more than the monthly average from 2006 to 2008.
Xiamen’s average monthly transactions in the first four months were 267 per cent higher than last year and 56 per cent more than the monthly average over the last three years.
DTZ data shows Xiamen posted the strongest growth in property prices - a 13 per cent surge in the first four months of the year - while prices in Shenzhen rebounded 6.5 per cent. In Guangzhou, prices have consolidated at about 8,000 yuan (HK$9,075) per square metre.
But Mr. Chiang expects that over the remainder of the year, developers will respond to improved demand by trying to sell as many units as possible and resist raising sale prices sharply because of abundant stock.
The next challenge for the mainland property market was whether demand for luxury homes could be sustained, said Mr. Chiang.
“Developers have launched a few luxury units to test the market in the last few months and recorded strong sales. But there will be potential concern about the sales once the supply of high-end units increases,” he said.
Denis Ma, an associate director of research at Jones Lang LaSalle in the Pearl River Delta, said demand remained sensitive to price swings.
“Without clear signs of a sustainable economic recovery, buying demand remains contingent on prices remaining at current levels,” he said.
While relatively stronger demand had moderated the downside risk in prices, a strong rebound was unlikely in the short term, while in the luxury segment, a lack of leasing demand and supportive measures from the government would limit buyers to end-users, he said.
Any rebound in volumes and prices in this segment would not materialise until a sustained economic recovery was in place, Mr. Ma said.
Sherman Lai Ming-kai, a vice-chairman at Centaline Group, said property sales had slowed down by the end of May since prices had increased. He expected no further jump in prices this year.
“The rebound in home sales is due to the government’s policies, not because of an improvement in the economy,” Mr. Lai said. “The mainland is still suffering from a decline in exports and developers will only raise sales prices moderately.”
1 comment:
Key southern cities leading property sales rally
Yvonne Liu
8 June 2009
The three cities that led the downturn in the mainland property market last year - Shenzhen, Guangzhou, and Xiamen - are now leading the recovery in the market, analysts say.
The three leading southern China cities recorded the biggest drops in property prices - an average of 36 per cent - in the country last year after Beijing imposed measures aimed at cooling the overheated market.
But buyers were now returning after the government reversed the measures and banks relaxed housing loan conditions, said Alan Chiang Sheung-lai, the head of residential property at property consultant DTZ.
As a result, prices had recovered or stabilised, though developers were unlikely to jeopardise the recovery by trying to raise prices further in the second half of the year, he said.
In Shenzhen, residential sales had risen in the first four months of the year to a monthly average of about 594,000 square metres, 82 per cent greater than the average monthly sales for the same period last year and 37 per cent more than the monthly average from 2006 to 2008.
Xiamen’s average monthly transactions in the first four months were 267 per cent higher than last year and 56 per cent more than the monthly average over the last three years.
DTZ data shows Xiamen posted the strongest growth in property prices - a 13 per cent surge in the first four months of the year - while prices in Shenzhen rebounded 6.5 per cent. In Guangzhou, prices have consolidated at about 8,000 yuan (HK$9,075) per square metre.
But Mr. Chiang expects that over the remainder of the year, developers will respond to improved demand by trying to sell as many units as possible and resist raising sale prices sharply because of abundant stock.
The next challenge for the mainland property market was whether demand for luxury homes could be sustained, said Mr. Chiang.
“Developers have launched a few luxury units to test the market in the last few months and recorded strong sales. But there will be potential concern about the sales once the supply of high-end units increases,” he said.
Denis Ma, an associate director of research at Jones Lang LaSalle in the Pearl River Delta, said demand remained sensitive to price swings.
“Without clear signs of a sustainable economic recovery, buying demand remains contingent on prices remaining at current levels,” he said.
While relatively stronger demand had moderated the downside risk in prices, a strong rebound was unlikely in the short term, while in the luxury segment, a lack of leasing demand and supportive measures from the government would limit buyers to end-users, he said.
Any rebound in volumes and prices in this segment would not materialise until a sustained economic recovery was in place, Mr. Ma said.
Sherman Lai Ming-kai, a vice-chairman at Centaline Group, said property sales had slowed down by the end of May since prices had increased. He expected no further jump in prices this year.
“The rebound in home sales is due to the government’s policies, not because of an improvement in the economy,” Mr. Lai said. “The mainland is still suffering from a decline in exports and developers will only raise sales prices moderately.”
Post a Comment