Sales of New Homes in Beijing Show 48.8% Slump; Lowest Since 2005

Published Date : Jul 01, 2014

Newly-built homes are selling less in China’s capital, latest market figures have revealed. New home sales were reported to have shown a 48.8% slump in 2013, as compared to the same period last year. According to a report by the Securities Daily, this is the lowest ever mark since 2005. 

The rising property prices in the world’s second-largest economy have further weighed down buyer sentiment, resulting in a cooling house market. According to statistics published by the Centaline Property Agency, as of June 26, 2014, the total number of new home units sold stood at 22,782 with a total area of 2.75 million sq meters. In the same period, average prices, on the other hand, were reported as being approximately USD 4,300 per sq meter. This marks an 18.8% spike as compared to the previous year.

Sales volumes have been dwindling in Beijing, consequently pushing up the city’s housing inventory to an 18-month peak. The housing inventory also includes properties under construction. According to the report, the percentage of property construction went up by 70% from the same time last year. 

However, as the Beijing Municipal Commission of Housing and Urban-Rural Development eases restrictions pertaining to high-end housing, supply of top-of-the-line housing units will likely see a surge. High-end housing constitutes about 30% of the total housing supply that will be available in this market in July 2014. Market watchers opine that this could, however, fail to have the desired stimulus on the cooling housing property market. The tightening monetary policy will not help this cause either.