Thu, Jan 19, 2012 - Page 10 News List

Housing prices fall in Chinese cities

SHARING THE WEALTH:Despite worries about a global economic slowdown, foreign direct investment in China rose 9.7% last year as Asian countries boosted spending

AFP, SHANGHAI

China’s moves to curb property speculation are finding their mark as home prices in nearly three-quarters of its major cities fell last month from November, the government said yesterday.

Beijing has introduced a range of measures aimed at curbing the real estate market over the last year, such as bans on buying second homes, hiking minimum down-payments and introducing property taxes in select cities.

However, analysts are concerned that the correction in the property market could have broader -implications for the world’s second-largest economy, which is already widely forecast to slow this year from 9.2 percent growth last year.

Fifty-two of 70 Chinese cities tracked by the government, including Shanghai and Beijing, recorded month-on-month falls in new home prices, the Chinese National Bureau of Statistics said, with the total up slightly from 49 in November.

Home prices in two small, inland cities rose last month from the month before, while 16 others were flat, it said.

“If this trend continues, with property transaction volume falling, we will have to see whether China’s economy can cope with it,” said Liu Ligang (劉利剛), head of Greater China economic research for ANZ Group in Hong Kong.

With debt-burdened local governments dependent on land sales as a key source of revenue, China could roll back measures to offer them some relief, he said.

Figures released on Tuesday showed housing sales — excluding government subsidized homes — rose 12.1 percent to 5.91 trillion yuan (US$936.3 billion) last year, marking a slowdown from 18.9 percent growth in 2010.

Investment in all types of property rose an annual 27.9 percent to 6.17 trillion yuan last year, slowing from growth of 33.2 percent in 2010, the statistics bureau said.

China’s Renmin University has said that the government will likely relax some property market curbs this year because of concerns that slumping prices could hurt economic growth.

However, Chinese officials say the measures will remain in place for now. Shanghai Mayor Han Zheng (韓正) said earlier this week that the commercial hub, among China’s most active property markets, would maintain the control policies.

Meanwhile, foreign direct investment in China rose 9.7 percent last year to a record US$116 -billion, as Asian countries boosted spending despite the global economic turmoil, the government said yesterday.

However, investment by overseas companies fell for a second straight month last month, down 12.7 percent year-on-year to US$12.2 billion, as the worldwide slowdown began to take hold, the Chinese Ministry of Commerce said in a statement.

Ministry spokesman Shen Danyang (沈丹陽) blamed the drop on weakness in the US and European economies, but predicted foreign investment would hold up this year.

“Some major developed economies such as the US and Europe are weak. Companies are being more cautious in their investment decisions and global multi-national investments have dropped,” he said. “Nonetheless, we believe both China’s overseas investment and foreign direct investment will maintain relatively rapid growth this year.”

Inward investment from US companies suffered the most last year, plunging 26.1 percent to US$3 billion, while European investment registered a slight fall, down 3.65 percent at US$6.4 billion.

The strongest growth came from Asian countries, with investment from Hong Kong, Macau, Taiwan, Japan, the Philippines, Thailand, Malaysia, Singapore, Indonesia and South Korea combined rising 14 percent to US$100.5 billion.

This story has been viewed 1991 times.
TOP top