Developers Fall on Economy, Speculation of Curbs: Shanghai MoverBloomberg News
China Vanke Co., Poly Real Estate Co. and Gemdale Corp. led declines by shares of property developers on concerns that China’s economy is slowing and that authorities may introduce new curbs to rein in home prices.
A gauge of developers listed in Shanghai declined 1.5 percent at the close of trading. Vanke, China’s biggest publicly listed developer, fell 2.6 percent to 11.32 yuan in Shenzhen, the most since April 25. Poly Real Estate fell 3 percent to 11.59 yuan, and Gemdale dropped 3.3 percent to 7.04 yuan in Shanghai. The benchmark Shanghai Composite Index fell 1.1 percent.
Homes sales in China fell 13 percent in April from the previous month after measures ordered by the government this year, including higher down-payment requirements and strict enforcement of transaction taxes, began to take effect. The 21st Century Business Herald reported today that the city of Beijing is requiring developers get approval from the mayor’s office before they can begin pre-sales of homes.
“Weekly sales aren’t strong and there is speculation that the government may come out with more policies,” Jinsong Du, a property analyst with Credit Suisse Group AG in Hong Kong, said by telephone today. Weaker-than-expected economic data is another reason for the declines, Du said.
Data released by the National Bureau of Statistics yesterday showed fixed-asset investment growth unexpectedly decelerated for the first four months to 20.6 percent, compared with the 20.9 percent pace for the first quarter. The median of estimate of 37 economists surveyed by Bloomberg had been for fixed-asset investment growth of 21 percent.
— With assistance by Regina Tan, and Cindy Wang