chinese government property curbs continue to have desired effect
News Posted On: 23 February 2012
The latest data from the National Statistics Bureau shows none of the 70 Chinese cities monitored showed any price gains in January, proving the effectiveness of the government's property curbs.
Property prices in 47 of the cities fell, while the remaining cities prices were unchanged from December. Prices of new homes declined in the four major cities of Shanghai, Beijing, Shenzhen and Guangzhou which is the fourth month they have shown price falls.
The falls come after the government implemented a series of measures to cool runaway price inflation, measures including higher deposits and mortgage rates, and home purchase restrictions in 40 cities. The Premier Wen Jiabao has already stated his determination to bring prices down to reasonable levels ensuring stability and fairness.
Economists think property prices will continue to fall until at least the latter half of the year, but some expect property curbs to be eased during the fourth quarter. Although prices are falling it is hardly a property crash. Sales of homes in China's four major cities also declined during the Lunar New Year holiday at the end of last month, with transactions dropping an average of 66% compared with the same period last year.
Some of the smaller cities have already attempted to ease property curbs over worries about falling house prices. The city of Wuhu was the one of the first to attempt to do so by subsidising some home purchases and waiving a deed tax. These new measures lasted just three days before being suspended, as was an earlier attempt by Foshan in southern China.
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Written by Les Calvert
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