Real estate heat sup along perimeter of new economic zone

Although local governments including Xiongxian and Rongcheng counties in Hebei province have frozen all real estate sales after the central government announced the establishment of the Xiongan New Area on Sunday, property prices in some perimeter zones have surged while transactions in other perimeter areas have been halted.

Despite the fact that Wenan county is 30 kilometers away from Xiongxian county, and it hasn’t been involved in any developing plans regarding the new economic zone area, housing prices in Wenan jumped from 4,700 yuan per square meter on Sunday to 5,500 yuan per sq m on Monday.

Xu Yan, a property sales representative in Wenan, said the news has not only boosted the housing prices, but also increased real estate developers’ confidence.

“As many speculators cannot purchase in three counties that form the new area, they have rushed to surrounding areas to buy properties,” said Xu.

Many property projects in Bazhou, another place close to the Xiongan New Area, offered prices between 17,000 and 20,000 per sq m, and many demanded that buyers make full payment.

He Jingtong, a business professor at Nankai University in Tianjin, said the government has made specific plans for infrastructure, commercial and transportation projects in the new area, but it is too early to speculate on activities in surrounding areas.

The new area’s establishment also had an impact on the stock market on Monday, with the share price of Beijing-based cement manufacturer BBMG Group Co surging by 23.84 percent in the Hong Kong Stock Exchange during the opening quotation.

The trading price of Shijiazhuang-based China Suntien Green Energy Co, a new energy product supplier, grew by 23.33 percent during the peak time in the Hong Kong stock market on Monday.