Property sales plunge during Golden Week

Updated 2017-10-09 09:32:53 Global Times

Rental market boom expected in near future

Domestic cities with hot property markets witnessed a slump in transactions during the eight-day Golden Week holidays starting from October 1, falling to the lowest level since 2014, industry data showed.

In the first six days of the Golden Week, a total of 101 new and second-hand homes were sold in Beijing, an eight-year low, cnr.cn reported on Sunday, citing data from Centaline Group's research center.

The report said a total of 147 new homes were sold in Shanghai during the same period, down nearly 80 percent year-on-year, and real estate developers in Guangzhou, capital of South China's Guangdong Province, saw a drop of nearly 70 percent.

Tightened regulations, the holiday factor and a high base of comparison from the same period last year are the main reasons for the drop, said Yan Yuejin, a research director at Shanghai-based E-house China R&D Institute.

"The adjustment policies released since September last year to cool the hot real estate market are gradually taking effect. Besides, with the coming of the long holiday, residents slowed the pace of house purchases and banks lowered or curtailed lending. Strict pre-sale permit regulations also affected the rollout of new homes and real estate transactions," Yan told the Global Times on Sunday.

In North China's Tianjin, people queuing up to get loans has become normal, and some banks have even suspended their house loan business, the Xinhua News Agency reported Sunday. It said most commercial banks' house loan interest rates are 5 to 10 percent higher than the standard interest rate, with some banks charging interest rates up to 30 percent higher for house loans.

In the remainder of this year, there will be a focus on accelerating the development of the house rental market and increasing the provision of rental property in order to curb real estate speculation, cnr.cn reported.

More than 20 cities in eight provinces have released policies encouraging the development of the house rental market. For example, Beijing's policy for joint property ownership - an unprecedented policy, under which homes will be owned jointly by the government and individuals - took effect on September 30, according to the Beijing Municipal Commission of Housing and Urban-Rural Development. The city plans to provide 250,000 joint property ownership apartments in the next five years.

Huang Nubo, chairman of Beijing Zhongkun Investment Group Co, said the property industry will see another 20 years of strong development, as more developed transportation networks drive further urbanization, China Real Estate Business reported on Sunday.

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