Source: CCTV.com

02-25-2008 11:10

There's been a definite chill in China's property sector in recent months.

The main reasons for that being government policies and new mortgage conditions which have targeted speculators on the hunt for second properties.

There's been a definite chill in China's property sector in recent months.(CCTV.com)

But property developers are trying to turn things around. In big cities like Beijing and Shanghai, they're are now offering discounts in a bid to pull in customers. But as Emma Moore finds out, most are still wary, and are holding out for the better buy.

At a newly-developed property near Beijing's east fourth ring road, there were only a couple of visitors despite it being the weekend.

Sellers say compared with the average turnover of 40 apartments per month last year, they are now only able to sell 10 apartments per month at most.

China's latest measures to rein in mortgage loans have cooled down the red hot property market. Beijing began to see turnover in its property market drop off at the end of last year.

In response, many developers have begun offering more favorable policies to boost sales and improve their balance sheets after the Spring Festival holidays.

But their discounts are limited to around 5 percent. And it seems that's just not enough to attract potential buyers.

Despite lower turnover, housing prices continue to increase, although according to some data, at a slower pace.

Take this property for example. The current price has risen by almost 50 percent from that of last June.

Buyer, said, "The price is too high, it's unbearable for common people. I think the price will drop in the future."

Insiders gave an explanation for the price spike and turnover decline.

Li Wenjie, General Manager, Centaline China Real Estate Co., said, "I think the first reason is the supply shortage. Only 170 million square meters' property were supplied last year, more than 30 percent less than that in 2006. The macro-control policies to cool property market and the promotion of affordable housing have changed people's expectation on the price movement. So they are not in a hurry to make decision."

Experts say the situation may change after March, as Beijing has announced it will build more housing this year.

Over one third of the new properties are earmarked to be low-rent housing or affordable housing.

 

Editor:Zhang Pengfei