Number of unsold homes rises slightly

08:59, August 06, 2010      

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Unsold homes rose 0.2 percent in terms of floor space at the end of June from a year earlier, the smallest increase since 2008, according to data published by the National Bureau of Statistics (NBS) late Wednesday.

This is the first time such data has been made publicly available. The NBS said it conducted a survey of 80,522 property developers nationwide to derive the data, but it noted that unsold homes were not the same as vacant housing - a gauge of real estate speculation.

Vacant housing, houses sold but unoccupied, has been hot topic in past weeks, though no official data has ever been released on it.

The public believe housing speculation is behind rocketing housing prices, making it a sensitive issue, said Hui Jianqiang, an analyst with E-house China, a real estate research firm in Shanghai.

The housing industry regulations launched in April have made home sales drop about 60 to 80 percent in China's major cities, such as Beijing and Shanghai, according to E-House China.

The regulator required a 50 percent down payment for second-home buyers and increased the interest rate to 1.1 times that of benchmark rate. Third-home buyers were not allowed to get mortgage loans.

Housing prices in 70 cities dropped 0.1 percent month-on-month in June, the NBS said July 12, though rose 11.4 percent from a year earlier.

"The regulations have had some effect," commented Hui.

Hui predicted that housing prices would drop 10 to 20 percent by the end of the year. Nomura Holdings said in a July report that average prices may fall as much as 20 percent over the next 12 to 18 months.

Unsold homes totaled about 12 percent of 2009 home sales at the end of June, down from the end of 2009.

Source: Global Times


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