Guangzhou warns off property purchasers

PUBLISHED : Thursday, 11 May, 2006, 12:00am
UPDATED : Thursday, 11 May, 2006, 12:00am

Price rises of up to 40 per cent for some of Guangzhou's prime properties over the past year have prompted authorities to recommend home buyers delay purchases for three years.

The price surge has also prompted the Guangdong Land Resources Department to assure the public there is an ample land supply and that the government will act to regulate the market.

The department's director-general, Lin Haokun, said the high number of vacant apartments indicated that recent price rises did not have any basis. When asked when would be the best time to buy property, he said: 'In three years.'

Soaring housing prices have resulted in more than 16,000 people putting their names to a campaign by Shenzhen businessman Zou Tao to boycott purchases.

In a rare move, senior Shenzhen Land Resources Bureau official Geng Jijin met Mr Zou to discuss his concerns.

According to Xinhua, Mr Zou asked Mr Geng whether it was normal for Shenzhen property prices to rise 35.46 per cent in the first quarter to more than 10,000 yuan per square metre.

He questioned whether the land sales system was reasonable.

Mr Geng replied that from a national perspective, Shenzhen had handled its housing quite well, but prices appeared to have risen very quickly because they had been relatively low in recent years.

CB Richard Ellis director Louis Chan said investors saw the Guangzhou market as more stable than Beijing or Shanghai's and were buying in the belief that would rise. 'It's very hot now, especially residential properties,' he said.

Mr Chan said one of the hottest properties was being developed in Tianhe district by Singapore's CapitaLand.

'Prices in Tianhe were about 7,000 to 8,000 yuan per square metre one or two years ago. Now they exceed 10,000 yuan,' he said.