China Home Prices Jump by Most This Year as Demand Defies CurbsBloomberg News
China’s new home prices jumped by the most this year in October as homebuyers defied the government’s property curbs and developers offered more high-priced apartments to tap demand.
The average price surged 10.7 percent last month from a year earlier to 10,685 yuan ($1,753) per square meter (10.76 square feet), SouFun Holdings Ltd., the nation’s biggest real estate website owner, said in a statement after a survey of 100 cities. Prices rose 1.24 percent from September, the 17th consecutive month of increases.
Chinese developers rose by the most in more than a month in Shanghai yesterday as a meeting by the ruling Communist Party fueled speculation that the authorities will refrain from imposing further property curbs. Real estate companies boosted supplies of high-end homes last month to seek greater profit margins, tapping the “unabated enthusiasm” among homebuyers in a traditionally strong season, SouFun said in the statement.
“The numbers are no surprise, but the month-on-month increases may start to narrow starting in November because supplies are no longer that tight,” said Luo Yu, a Shanghai-based analyst at advisory CEBM Group. “Property curbs may diverge, with cities with excessive gains possibly tightening further while others loosening a bit.”
Former Premier Wen Jiabao in March stepped up a three-year campaign to contain price gains.
Last month’s month-on-month increase widened from September’s 1.07 percent, though the number of cities with gains exceeding 1 percent dropped by five to 29, SouFun said. Housing sales in the first nine months surged 34.5 percent to 4.54 trillion yuan from a year earlier, according to government data released Oct. 18.
New home prices in China’s four major cities jumped the most since January 2011 in September, with prices in the southern business hub of Shenzhen and Guangzhou surging 20 percent from a year earlier, the National Bureau of Statistics said Oct. 22 in its latest home-price data release.
The city of Changshu in the eastern province of Jiangsu led gains last month, with prices rising 3.92 percent from September, according to today’s SouFun data. Prices dropped 2.18 percent in Lianyungang, in the same province, the biggest decline.
An Oct. 30 government statement about a study session on housing by the ruling party’s decision-making Politburo didn’t mention home prices, triggering speculation policy makers won’t impose further curbs, according to Credit Suisse Group AG. President Xi Jinping reiterated in that statement a government target of building 36 million units of affordable housing in the five years ending 2015, which CEBM’s Luo said heralds an acceleration in the construction of such homes that could reduce demand for commercial homes.
— With assistance by Dingmin Zhang