Realty firms' share issues put on hold

08:11, April 28, 2010      

Email | Print | Subscribe | Comments | Forum 

Impact on economy yet to be assessed, say analysts

Plans by real estate companies to raise capital through share issues face a moratorium amid the government's efforts to curb run-away housing prices.

Stock issue plans submitted by 45 such companies, amounting to 110 billion yuan ($16 billion), could be affected, sources close to the China Securities Regulatory Commission (CSRC) told China Daily.

The figure would be more than double the amount developers raised from the domestic stock market in 2009, when housing prices rebounded robustly, reaching historic highs in some places.

The suspension will give officials in charge of land price administration at the Ministry of Land and Resources (MLR) an opportunity to investigate if, or how, companies employed illegal or improper methods to manipulate market prices, official sources said.

The government's decision to rein in rocketing housing prices has reportedly triggered the stock market decline for the past week, although economists are divided over its effect on the economy.

Li Daokui, an economics professor at Tsinghua University, told China Daily that he doesn't think the tightening of real estate market regulation will directly dent the overall economy because urbanization will continue to drive growth.

Zhang Xiaojing, an economist at the Chinese Academy of Social Sciences, said it will take two to three months for the government to assess the full impact of the tightening policy.

On April 17, the State Council, or the cabinet, released 10 guidelines that call for all-out efforts to maintain stability in the housing market.

【1】 【2】


  • Do you have anything to say?


Special Coverage
  • Premier Wen Jiabao visits Hungary, Britain, Germany
  • From drought to floods
Major headlines
Editor's Pick
  • On Sept. 26, a resident passes by a flower terrace decorated for the coming National Day. (Xinhua/Hang Xingwei)
  • The photo, taken on Sept. 26, shows the SWAT team ready for the joint exercise. (Xinhua/Wangkai)
  • Two metro trains in Shanghai collided Tuesday afternoon, and an identified number of passengers were injured in the accident, the Shanghai-based reported. Equipment failures were believed to have caused the crash on the Line 10 subway, Xinhua quoted local subway operator as saying.
  • An employee at a gold store in Yiwu, located in east China's Zhejiang province, shows gold jewelry on Monday.(Xinhua/Zhang Jiancheng)
  • Tourists ride camels near China's largest desert lake Hongjiannao in Yulin, north China's Shaanx Province, Sept. 24, 2011. Hongjiannao is shrinking as a result of climate change and human activities, and may vanish in a few decades. Its lake area, which measured more than 6,700 hectares in 1996, has shrunk to 4,180 hectares. Its water level is declining by 20-30 centimeters annually and its water PH value has risen to 9.0-9.42 from 7.4-7.8. (Xinhua/Liu Yu)
  • Actors perform royal dance at the Gyeongbok Palace in Seoul, Sept. 27, 2011. A ceremony commemorating the 38th South Korea Sightseeing Day was held in Gyeongbok Palace on Tuesday. (Xinhua/He Lulu)
Hot Forum Discussion