|A newly constructed residential community in Handan, Hebei province. Of the 70 major cities monitored by the National Bureau of Statistics, Wenzhou in Zhejiang province is the only city that saw a year-on-year decline in home prices. Hao Qunying / For China Daily|
Increases seen in 65 major cities on monthly basis
Property prices in China's major cities continued to rise in October, but increases are expected to stabilize following the Third Plenum of the Communist Party of China's 18th Central Committee, industry experts said.
Among 70 major cities monitored by the National Bureau of Statistics, only one — Wenzhou in Zhejiang province — saw a year-on-year decline in prices last month.
Shanghai, with a 21.4 percent increase from the same period last year, led the price hike list.
Beijing ranked second, with a 21.2 percent jump, the bureau said on Monday.
On a monthly basis, 65 cities saw a price increase, with the biggest growth rate at 1.3 percent. Prices were flat in three cities and lower in two cities.
The situation in the pre-owned home market was much the same — and the figures have left property developers quite optimistic about the market
According to William Kwok, director of Cheung Kong Real Estate Ltd, the company's sales are expected to reach 2 billion yuan ($328 million) or even 3 billion yuan this year, which could increase as much as 50 percent over 2012.
The robust land market also buoyed housing prices in major cities.
The selling price of Jinmao Residence in Beijing's southeastern suburb of Yizhuang, for instance, rose from the original target of 27,000 yuan per square meter to more than 35,000 yuan per sq m within just about a month.
That surge followed the sale of a site in the area at a price premium close to 50 percent.
"Almost all the potential buyers are purchasing apartments for trading up. This type of demand remains pretty strong in the market, buoying up prices," said a marketing manger at the Jinmao project who declined to be identified.
In an attempt to cool the market, local governments have tightened financing for those buying second homes.
The Guangzhou city government announced on Monday that the down payment for second-home buyers will be at least 70 percent.
Guangzhou was the third large city to raise the required down payment, after Beijing and Shanghai.
The central government is making efforts to increase land supply to better meet growing demand.
According to the Third Plenum decision, which was released last Friday, a unified market for construction land in cities and rural areas will be established.
"This potentially means regulation of the supply side of real estate by appropriating more land for the development of affordable housing, as we have seen recently," said Carlby Xie, head of research at real estate consultancy Beijing Colliers International Property Services Co Ltd.
In previous years, government curbs on the demand side have done little to check the rise in housing prices.
The "unified market" potentially refers to a more sustainable, long-term approach that will give local governments more leeway to set their own property policies, Xie added.
The recently concluded Third Plenum will help stabilize property prices in the long run, according to a report from real estate brokerage Century 21.
The imbalance in supply and demand will gradually correct itself after the Party meeting, and that should help curb any further increase in prices, said Kou Hailong, general manager of Century 21 Beijing.
"Meanwhile, potential buyers are taking a wait-and-see attitude," Kou said.
Brisk land transactions will ensure a large supply for future developments, especially in affordable housing. That should also help stabilize the market, he said.
"But a big price drop is still unlikely in the short run," Kou added.