Realty brokers in China may step up promotions amid slump
June 9, 2014 Leave a comment
Realty brokers in China may step up promotions amid slump
Staff Reporter
2014-06-03
The prices of newly built houses in 100 Chinese cities averaged 10,978 yuan (US$1,757) per square meter in May this year, according to a report published by the China Index Academy, a major property research institute in China.
The figure represented a drop of 0.32% from the previous month, and the first drop in 23 months after June 2012. The report also indicated that among the 100 cities, prices in 37 rose from the previous month, while they dropped in 62. The prices only remained stable in one city.
Zhang Dawei, an analyst with Centaline Property, said the property slump began early this year and the trend of a cyclical adjustment in the market is now very obvious.
He said that this is the first property slump in history that was not a result of policy factors, which he said could lead to a longer and deeper adjustment period, especially in non-nuclear cities.
Beijing has not unveiled any policies to control housing prices since March 2013, and the recent market slump has been attributed to the rising real estate mortgage and credit because of fund shortages, with some cities having more supply than demand, and bidding farewell to a time of insufficient supply.
In addition, regional real estate price cuts have spread to eastern Chinese provinces such as Zhejiang, Jiangsu and Jiangxi. At the same time, potential buyers have adopted a “wait and see” attitude after seeing the continued price drop as real estate agents began adopting the strategy of “surrendering part of the profits in exchange for more sales.”
Under these circumstances real estate agents could step up their promotions in June.
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