Property market cools in top cities after new govt measures

New Delhi, October 23, 2016: The property market in several cities cooled in October following the implementation of new government policies, and experts have argued that house prices will remain stable in the near future.

According to a statement released on Friday by the National Bureau of Statistics (NBS), 15 cities including all of China’s first-tier cities and several second-tier cities like Wuxi, East China’s Jiangsu Province saw the month-on-month growth of their house prices slow in October.

Two of the 15 cities, Shenzhen, South China’s Guangdong Province and Chengdu, capital of Southwest China’s Sichuan Province, actually saw prices fall compared with the previous month.

Jiang Yining, a real estate analyst with Capital Securities, told the Global Times on Friday that the cooling market is the result of recently launched government measures which have suppressed demand for property.

The government has rolled out measures including a rise in required down payments and buying restrictions in a number of cities to manage the overheated property market.

But the strictness of the policies differs from city to city, and they are not aimed at creating a full-blown crackdown on the market, Wang Tao, a UBS China economist, said during a press conference on Thursday.

“House price growth has narrowed in many cities to a very slight extent in October, which meets the government’s expectations as the government wants house prices to rise moderately,” Jiang said.

He also said that the government wants more money to flow into the property markets of third- and fourth-tier cities, which are still facing an excess of housing stock.

“I don’t think house prices will fall sharply in the future. Instead, the property market will run very stably,” he said, adding that the government doesn’t want the real estate sector to slip too much as it is an important driving force for economic growth.

Measures have also been introduced by many local governments in October to address illegal operations by property developers, the Shanghai-based National Business Daily reportedFriday. –Global Times