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Real Estate

As expected, China property bubble reinflates


China Housing BubbleThe government may be putting a lid on it, but if China‘s housing market was a metaphorical “soup de jour”, it is back to boil over.

Property prices are rising in 53 out of 70 cities surveyed by the National Bureau of Statistics (NBS) in January.

Twenty-five cities in November and 12 in October experienced a price hike on a yearly basis, indicating a rally in the housing market.

4.7 % average increase

The average price increase in those cities was 4.7%, up from last month’s 2.4% rise in property prices for new homes, the NBS figures showed.

“Despite measures to cool property market speculation, housing demand still grew steadily in the second half of 2012, resulting in a rebound in prices, and this trend is continuing into early 2013,” Mark Budden, China manager of property consulting firm EC Harris told China Daily.

The usual suspects – Beijing, Shanghai and Guangzhou – led the ongoing spike in housing prices. New home prices in Beijing rose by 3.3% from January 2012 and are up 1.6% from December levels. Guangzhou prices rose 2% on the year and 4.7% from December, with Shanghai roughly following suit.

Housing one of the most popular investments

The government has been trying to curb property speculation by making it harder for second time home buyers to acquire property. Housing is one of the most popular investments of the Chinese middle class and elite. Rising housing costs in Shanghai, Beijing and Guangzhou have exacerbated the problem of rising inequality in China, as the major city centres become unaffordable to many middle class and lower-middle class Chinese.

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About Political Atheist

Living in South East Asia (Vietnam & Cambodia). At the ending/starting point of the more than 1000 year old SIlk Road.

Discussion

2 thoughts on “As expected, China property bubble reinflates

  1. I find it hard to believe that the price of real estate is going up anywhere in China. Of course, real estate is always about location so maybe Guangzhou, Shanghai, and Beijing will not have a bubble or a reinflated bubble. The rest of China, or at least the part of China I see all of the time, has a huge housing glut. I think there are tens of thousands of empty and vacant apartments/condos here. The empty apartment windows stare down at the road like the eyes of ghosts. There are not nearly enough people for all of the houses that already exist, that is not a recovering bubble for most of China.

    Like

    Posted by 1of10boyz | February 25, 2013, 8:54 pm

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