Sector brief: Property
China house prices jump by 9.5% in January
February 12, 2010: Rising property prices continue to create policy concerns, but fears that Beijing will pull the cord on the housing market are overplayed
Housing prices in China’s 70 largest cities rose 9.5% year-on-year in January, 1.3% higher than December, according to the National Development and Reform Commission. Prices of new home were up 11.3% from the same time last year and up 1.7% from the previous month, while secondary market prices increased by 8% year-on-year and just under 1% month-on-month.
The data gives credence to fears that the property market is following the trajectory of the last price cycle, when aggressive acceleration peaked in late 2007 after the government intervened to prevent the market from imploding. Though based on historical experience, these fears are overplayed. Since the middle of 2009 Beijing has been issuing warnings about rising house prices. Commercial banks have been reprimanded over lending to developers and a number of subtle cooling measures have been introduced, including a tightening of third home mortgages and the reinstatement of a business tax exemption period on...
The data gives credence to fears that the property market is following the trajectory of the last price cycle, when aggressive acceleration peaked in late 2007 after the government intervened to prevent the market from imploding. Though based on historical experience, these fears are overplayed. Since the middle of 2009 Beijing has been issuing warnings about rising house prices. Commercial banks have been reprimanded over lending to developers and a number of subtle cooling measures have been introduced, including a tightening of third home mortgages and the reinstatement of a business tax exemption period on...
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