No free rides amid price spi­ral

China Daily (Canada) - - HONG KONG - By ZHOU MO in Shen­zhen sally@chi­nadai­

It is prob­a­bly eas­ier in Guangzhou to buy a home for your­self rather than for your car.

In some parts of the city, the price of a park­ing space has touched highs of 1.1 mil­lion yuan ($171,938).

That is roughly equiv­a­lent to buy­ing a 72-squareme­ter unit when mea­sured by Guangzhou’s av­er­age price for new homes in June, or 15,177 yuan per square me­ter, ac­cord­ing to data from the Guangzhou Mu­nic­i­pal Land Re­sources and Hous­ing Ad­min­is­tra­tive Bureau.

Some of the prici­est park­ing spa­ces are at a residential pro­ject in the city’s old Yuexiu dis­trict.

Ac­cord­ing to the latest sta­tis­tics from the Guangzhou Park­ing As­so­ci­a­tion (GPA), most of the city’s park­ing spa­ces are priced be­tween 300,000 yuan and 600,000 yuan.

Res­i­dents in the Guang­dong pro­vin­cial cap­i­tal are now un­der in­creased pres­sure to se­cure a park­ing space, as a se­ri­ous short­age adds to con­cerns over ris­ing home prices since June in the tra­di­tion­ally af­ford­able city.

In­dus­try in­sid­ers say the num­ber of pri­vate cars in Guangzhou has crossed 1.6 mil­lion. But there are only 660,000 park­ing spa­ces in the city and, of these, only about 350,000, or 53 per­cent, are in residential ar­eas.

As many as 170,000, or 26 per­cent, are com­mer­cial fa­cil­i­ties and the re­main­ing 140,000, or 21 per­cent, are at public park­ing lots.

That means five cars have to com­pete for one park­ing spot in residential projects.

“There is a se­vere im­bal­ance be­tween sup­ply and de­mand,” said Guo Jun­rong, deputy sec­re­tary gen­eral of the As­so­ci­a­tion of Guangzhou Au­to­mo­bile Ser­vice In­dus­try.

The shock­ing sit­u­a­tion for park­ing lots in Guangzhou is ex­pected to worsen when a new pol­icy takes ef­fect on Aug 15, un­der which all residential and com­mer­cial park­ing spa­ces will be sub­ject to mar­ket price, end­ing the era of gov­ern­ment con­trols over pric­ing.

Some in Guangzhou are con­cerned that park­ing costs would rise fur­ther and even make them un­able to af­ford a car.

“I had in­tended to buy a car first be­fore buy­ing an apart­ment, but now I am not sure whether it is a wise de­ci­sion,” said Fu Lei, 28, a sur­geon work­ing at a public hos­pi­tal in Guangzhou.

“It seems that prices of park­ing spa­ces have been ris­ing faster than those for hous­ing. It is in­cred­i­ble,” he said.

Ac­cord­ing to gov­ern­ment reg­u­la­tions, to be abol­ished this week, monthly rent for in­door park­ing space should be capped at 500 yuan, and at 200 yuan for out­door spa­ces.

That does not seem like a big fig­ure. But the re­al­ity is, the mar­ket has been trad­ing at a much higher level. In some residential projects in Guangzhou’s Haizhu dis­trict, monthly rent for a park­ing space has soared to 2,300 yuan.

Even the av­er­age rental price in the dis­trict has risen to dou­ble the amount set by the gov­ern­ment.

“Park­ing spa­ces in many residential projects have not been trad­ing at gov­ern­ment-pro­posed prices. Mar­ket-ori­ented trans­ac­tions are al­ready in play,” Pan Guo­fan, vi­cepres­i­dent of GPA, pointed out.

That is also the rea­son why Pan be­lieves park­ing spa­ces will not be­come more costly af­ter the new pol­icy takes ef­fect.

“Since the in­tro­duc­tion of the Prop­erty Law in 2007, some park­ing space own­ers have al­ready been selling their as­sets at mar­ket price ac­cord­ing to the law. There­fore, the new pol­icy will not cause a big im­pact in the short term,” noted Pan.

Other mar­ket watch­ers, mean­while, ques­tion the up­com­ing reg­u­la­tion and sug­gest that park­ing spa­ces should not be traded freely.

Huang Shid­ing, head of the Ur­ban Man­age­ment In­sti­tute at the Guangzhou Academy of So­cial Sciences (GASS), be­lieves that mar­ke­ti­za­tion can­not serve as a so­lu­tion to the prob­lem of park­ing space short­age.

“The gov­ern­ment should con­sider how to in­crease park­ing spa­ces in public ar­eas and not hand the is­sue over to­tally to the mar­ket.”

Peng Peng, a re­searcher at GASS, agreed. “When de­mand for park­ing spa­ces can­not be met, the gov­ern­ment should in­ter­vene and of­fer guid­ance to en­sure their proper use, rather than let­ting the is­sue go,” he said.

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