Chinese Property Values Continue Downward Trend
News Posted On: 26 April 2012
Government initiatives in China are having the desired effect, as property values are continuing to drift downwards. According to the National Bureau of Statistics, property prices of new homes fell in two thirds of China's major cities in March, and experts think they have further to go.
In comparison with February, sales prices of new homes fell in 46 out of 70 cities, with 16 cities seeing prices remain the same. Just eight cities saw a slight increase of around 0.2%.
When compared to March 2011, the price of newly constructed residential homes dropped in 38 cities out of 70, with prices remaining stable in 11 cities, but 21 cities saw prices increase by an average of 2.1% compared to last year, suggesting second and third tier cities in China are becoming far more popular.
Beijing again stated its intention to continue maintaining property control policies, even though economic growth slowed to just 8.1% during the first quarter of this year, which is nearly at a three-year low.
Investors are being told to expect more price drops during the coming months as the cost of housing is still substantially higher than just a few years ago. It's been estimated that prices will drop another 5% or 10% at least, as they still haven't fallen as low as the government would like. China's action means its property bubble is slowly deflating over the longer term, and there is little risk of it bursting in the same way it did in the States a few years ago.
View property for sale in China
Written by Les Calvert
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