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June new home prices up 0.05%

By Wu Yiyao  (China Daily)

13:19, July 03, 2012

Zhang Qidi feels that he can't wait any longer to find a home to buy.

Everybody he's talked to, including many agents, have told him prices are beginning to rise and if he doesn't hurry, his limited savings won't be enough to make the down payment.

So on Monday morning, bracing the sweltering heat, the 32-year-old salesman in a German-owned electronic appliance company, visited three newly developed complexes.

"I'm exhausted," he said during a break for lunch.

But there's no time to rest. He was scheduled to see more in the afternoon.

What's the rush?

"I am getting married in August and I want to buy a home for my future wife," he said.

Zhang's fiancee, Qiu Linna, keeps phoning for updates on prices and what discounts are being offered.

"With the 200,000 yuan we have, and house prices starting to rise in Shanghai, we don't have many choices left," he said.

The couple has been touring Shanghai on weekends and holidays to see apartments and meeting salespeople for almost a year now, waiting for further discounts on new homes, lower interest rates for home loans, and more affordable properties to be introduced.

The couple said they were just about out of time waiting.

"We follow house prices every day, and it seems that a turning point has come. Prices are no longer dropping, and if we wait for another year, our money will not be even enough for a one-bedroom apartment," said Liu.

According to a report released on Monday by China Index Academy, one of the largest research organizations that specialize in property information in China, new home average prices in China rose for the first time in 10 months in June as the government adjusted its monetary policies to boost the nation's economy by lowering benchmark interest rates in June.

House prices rose by 0.05 percent from May, reaching 8,688 yuan ($1,400) per square meters in June.

The median of new home prices in 100 monitored cities around China climbed to 5,750 yuan per square meter, a 0.88 percent month-on-month increase, according to the report.

Month-on-month comparisons show the average price of new homes in 10 monitored major cities in China grew in June.

In Shanghai and Beijing, average prices of 10 monitored properties hit 15,429 yuan per sq m, a 0.75 percent month-on-month increase.

In Shanghai, the average new home price was 23,141 yuan per sq m in June, a 0.65 month-on-month increase. And in Guangzhou, it was 15,145 yuan, a 0.48 percent month-on-month increase.

Year-on-year comparisons show that average prices are yet to hit the levels of 2011, despite the month-on-month increases.

A 1.9 percent year-on-year drop was reported in the average price of 100 monitored cities across China, while a 2.53 percent year-on-year drop was reported in the 10 major cities, the sixth consecutive year-on-year drop in 2012.

Beijing is the only city among the 10 monitored major cities that reported a year-on-year increase. In June, the average price of a newly developed property in Beijing hit 22,930 yuan, a 0.2 percent year-on-year increase.

"I don't think prices will be lower than the lowest point in 2011 in the near future, so I'll buy one in July," said Zhong Ping, another potential buyer in Beijing.

Property sales agents in Shanghai said trading of newly developed apartments has seen increasing numbers of buyers since April.

Jin Chun, a saleswoman in Minhang district in Shanghai, said she has seen trades increasing since the Spring Festival in January.

The property she works with started trading in April of last year, and there was no significant fluctuation in trade, except that sales slumped a little bit at the end of 2011.

"Now we see a different story, as around 100 potential buyers came to visit."

Some 300 apartments out of 400 she had for sale have gone, she said.

In Shanghai, home exchange centers in several districts suspended trading applications from those who are unmarried and without Shanghai household registration since late June, sticking strictly to the rules imposed by housing authorities over policies to control sales.

According to Wang Juelin, deputy director of the Policy Research Center under the Ministry of Housing and Urban-Rural Development, policies aimed at curbing prices will not be eased in short term.

In a recent speech, Vice-Premier Li Keqiang said China needs to continue to build its housing stock, and housing for low-income groups and commercial housing both need more supply.

The goal is a market in which speculative buying is curbed, prices are stabilized, and housing supply meets demand.

In late June, the State Information Center underlined its view that current curbs over prices are not expected to be loosened for the time being.

It also added that China should accelerate its reform of the real estate tax system and adjust land transfer fee policies, to build a long-term mechanism to control house prices, replacing the current system that relies on administrative measures.


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