Turn­around in Nov home prices stokes property mar­ket hopes

China Daily (Canada) - - BUSINESS - By ZHENG YANGPENG zhengyang­peng@chi­nadaily.com.cn

Growth in China’s new home prices quick­ened in Novem­ber af­ter a slack per­for­mance in Septem­ber and Oc­to­ber, a pri­vate sur­vey showed on Tues­day, stok­ing hope that the property mar­ket might pick up mo­men­tum again.

De­spite be­ing a tra­di­tion­ally slow sea­son for new homes, av­er­age home price in 100 cities rose by 0.46 per­cent month-on-month in Novem­ber to 10,899 yuan ($1703.3) per square me­ter, an ac­cel­er­a­tion from the 0.3 per­cent and 0.28 per­cent gains in Oc­to­ber and Septem­ber re­spec­tively, the China In­dex Acad­emy, a re­search unit of SouFun Hold­ings Ltd, said in a re­port.

The acad­emy data showed new homeprices strength­ened­fromOc­to­ber in 41 of the100c­ities it­mon­i­tored, down from 48 a month ear­lier. How­ever, this was off­set by the strong pick­upinafewc­i­ties. Shen­zhenagain led the na­tion with a 2.54 per­cent month-on-month ad­vance — this is slower than the 3.5 per­cent growth in Oc­to­ber, but com­pared with a year ago, it is al­ready 34.75 per­cent higher.

New home price in Shang­hai grew1.4 per­cent over Oc­to­ber, while Beijing prices gained 0.95 per­cent.

“A ma­jor change is that hous­ing sales grew in all kinds of cities, not only in first-tier cities. In­ven­tory pres­sure eased across the board. That might lead to re­newed price rise, though mod­er­ately, in small cities. Over­all, we ex­pect a ‘warm win­ter’ of the mar­ket,” said the re­port.

Adding to the op­ti­mistic sen­ti­ment is the re­vival in hous­ing sales af­ter a slack Septem­ber andOc­to­ber, which sur­prised the in­dus­try as it is tra­di­tion­ally a strong sales sea­son for pre-owned homes. For ex­am­ple, pre-owned home sales in Beijing in the first 29 days of Novem­ber hit 15,693 units, up 39 per­cent from the level of the same pe­riod in Oc­to­ber, ac­cord­ing toHomelink, a ma­jor pre­owned hous­ing bro­ker.

In Shang­hai, new home sales reached 1.4 mil­lion square me­ters in the first 29 days ofNovem­ber, which is ex­pected to be on par with sales in Oc­to­ber and ex­ceed­ing that of Septem­ber.

Mar­ket mavens are not sure if the cur­rent uptick would sus­tain. But top of­fi­cials have sent sig­nals they might step up the cur­rent ef­fort to prop up sales.

On Nov 10, Pres­i­dent Xi Jin­ping said the gov­ern­ment needs to “draw down the hous­ing in­ven­tory” and “strive to achieve healthy de­vel­op­ment of the property in­dus­try”.

It was for the first time sinceOc­to­ber 2013 that the top leader com­mented specif­i­cally on the property mar­ket, stok­ing hope that fur­ther pol­icy stim­u­lus may be on the way.

In Novem­ber, Shanxi prov­ince eased rules on­home­buy­ing, be­com­ing the fourth prov­ince af­ter Gansu, Sichuan and An­hui to undo pre­vi­ous curbs, in the hope of slash­ing more property in­ven­tory in China’s lower-tier cities. The eased en­vi­ron­ment has strength­ened de­vel­op­ers’ con­fi­dence, spurring them to snap up land in first-tier cities.

Ac­cord­ing to Cen­taline Property Agency, land sales in Beijing hit 56.1 bil­lion yuan in Novem­ber, the all­time peak for monthly trans­ac­tions. This year so far, the cap­i­tal has sold 192 bil­lion yuan worth of land, ex­ceed­ing the record of 191.7 bil­lion yuan set for the en­tire 2014.

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