China’s property market is still experiencing a slowdown. House prices declined for the third straight month and the average price of residential properties across 100 Chinese cities fell to CNY8,832 (US$1,392) per square metre in November. In the 10 first-tier cities such as Beijing and Shanghai, house prices decreased 0.36 per cent month on month to CNY15,663 (US$2,469) per square metre.
The government introduced cooling measures earlier this year to try and control the property market. The measures include restricting locals and foreigners from owning more than one or two homes, imposing annual property tax in some cities and requiring buyers to pay a minimum down payment of 30 per cent of the value for the first property and 60 per cent for a second unit.
For second hand property, the down payment ranges from 40 per cent to 60 per cent depending on the age of the property.
Other policies such as ensuring banks impose mortgage rates 1.1 times the benchmark lending rate and imposing a full business tax payment for a property that is resold in less than five years, have all contributed to a slowdown in property sales and prices according to The Star
Yu Tat Loong chief operating officer of Shanghai Firstreach Real Estate believes despite the drastic control measures put in place by the government, China still has a lot to offer developers.
“We will still expand our operations here because long-term wise there is room for development even in first-tier cities and especially so in second and third-tier cities,” he said.
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