Prop­erty prices reach for the sky in Shen­zhen

China Daily (Canada) - - FRONT PAGE - By QI­UQUAN­LIN in Guangzhou qi­uquan­lin@chi­nadaily.com.cn

Home prices in Shen­zhen, Guang­dong province, have risen to record lev­els, helped by lim­ited sup­plies and fur­ther re­lax­ations in pur­chase poli­cies, in­dus­try ex­perts said onWed­nes­day.

Ac­cord­ing to a sur­vey con­ducted by the China In­dex Academy, an in­de­pen­dent re­search in­sti­tute fo­cus­ing on the hous­ing in­dus­try, Shen­zhen led all cities in terms of hous­ing price in­creases dur­ing the past six months, with new residential prop­erty prices surg­ing by 6.58 per­cent in June from a month ear­lier.

Prices for sec­ond-hand houses rose by 8.59 per­cent in June from a month ear­lier, and by a dra­matic year-onyear surge of 19.12 per­cent, the sur­vey said. hous­ing to 40 per­cent from the pre­vi­ous 60 per­cent, and ex­empted apart­ments held by in­di­vid­u­als for over two years from cer­tain sales taxes.

Zeng Li, a se­nior re­searcher with global prop­erty ser­vice com­pany Jones Lang LaSalle, at­trib­uted the bur­geon­ing Shen­zhen hous­ing mar­ket to the pos­i­tive wealth ef­fect brought about by the stock mar­ket in April and May.

“There is anec­do­tal ev­i­dence to sug­gest that the pos­i­tive wealth ef­fect fol­low­ing a surg­ing do­mes­tic stock mar­ket has played a role and it may be one of the rea­sons why Shen­zhen has so far out­per­formed mar­kets in other cities,” she said.

Ac­cord­ing to data from China Se­cu­ri­ties De­pos­i­tory and Clear­ing Co, res­i­dents from Guang­dong opened the big­gest num­ber of new stock ac­counts among all re­gions in China in 2014, with Shen­zhen res­i­dents ac­count­ing for about half of all new ac­counts in the province.

“Given the strong his­toric re­la­tion­ship be­tween the per­for­mance of the do­mes­tic stock mar­ket and the residential prop­erty mar­ket, it is easy to see how the pos­i­tive wealth ef­fect may have con­trib­uted to the re­cent surge in sales vol­ume and prices,” she said.

Ac­cord­ing to JLL’s pre­lim­i­nary data, new home prices in Shen­zhen’s high-end residential prop­erty mar­ket grew by 7.5 per­cent in the sec­ond quar­ter of the year, with ask­ing prices in some projects in­creas­ing by as much as 30 per­cent year-onyear.

The volatile stock mar­ket in the past two weeks is un­likely to re­verse the bur­geon­ing re­cov­ery in the Shen­zhen hous­ing mar­ket, ac­cord­ing to Zeng.

“The fun­da­men­tals un­der­pin­ning Shen­zhen’s residential prop­erty mar­ket re­main strong, with more de­mand be­ing gen­er­ated by the ex­pan­sion of the lo­cal econ­omy and Shen­zhen’s of­fice mar­ket,” she said.

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