Housing market heats up in Beijing with lower mortgage interest rate

The property market in Beijing sprang back to life this week as the city's businesses returned to normal, with sales volume rebounding after the recent resurgence in COVID-19 cases receded.

In the Wangjing subdistrict of Chaoyang district, which is home to a lot of new housing developments, sales offices are seeing a surge of client numbers since they reopened several days ago

"We welcomed more than 50 groups of clients yesterday, which was quite a large number," said Wu, a salesman at a real estate agent in Chaoyang.

According to data released by the Real Estate Information Agency, Beijing's property market has been on an upward trend since April, but the pace slowed in May due to the COVID-19 resurgence.

From May 30 to June 5, 556 units were sold in new builds in Beijing, up 40.4 percent from the previous week, with transactions totalling 4.453 billion yuan (about 6.66 billion U.S. dollars), up 73 percent from the previous week.

In addition to the boom in sales of new builds, the market for existing housing stock is also flourishing in Beijing.

Data in May showed only 8,600 units sold in Beijing, down 40 percent from the previous month and 54 percent from the same period last year. However, the first week of June has shown strong recovery, with a daily average of 373 units sold per day, up about 20 percent on the previous week.

A recent mortgage interest rate reduction has also strengthened interest from house hunters.

"The mortgage interest rate has been lowered recently. A lot of clients are talking to us, mainly concerning whether the housing prices in this area are moving," said Chen, a real estate agent.

Since the beginning of this year, mortgage interest rates have fallen but some house hunters are hoping for further drops before making the next move.

"The house I am living is relatively small, and I want to move to a bigger one that can accommodate my whole family with three generations. So for me, buying a house would cost a lot of money. If the interest rate drops, that may tilt the lever, that is, I may be more willing to get a mortgage," said Li, a Chaoyang house buyer.