Swapping stocks for bricks
Raymond Xie has decided to retreat from the stock market and set his sights on fixed asset investments after experiencing the recent wild swings in the market.
'I'm frightened,' said Mr Xie, a Shenzhen-based supplier of housekeeping products to retailers.
He said the government was determined to curb the stock markets and that would result in a further fall in prices. 'Buying stocks has become risky,' said Mr Xie, who recently sold out for more than one million yuan.
'I have invested in the stock market for a number of years and made some money. But I think it is time to look at a safer investment vehicle,' he said.
Mr Xie has bought three flats in Shekou ranging from 800,000 yuan to more than two million yuan. 'Property agents told me land supply in the city is limited but demand is strong,' he said. 'Housing prices rise every month. You look stupid if you do not invest in property at the moment.'
In Shanghai, Zhou Lin, who joined the financial industry after graduating from university three years ago, also sold 50 per cent of his stock portfolio to diversify investment risk.
The stock sale was also spurred by a real demand.
'I am going to get married,' said Mr Zhou, who recently bought a 100 square metre flat in the suburbs for 700,000 yuan. 'The advantage of buying property is that you can hold it for your own use and for investment purposes.'
After a consolidation between 2005 and early this year, Mr Zhou said speculation activity in the housing market declined substantially.
'On the other hand, home demand in Shanghai is really strong. It is safe to buy property at the moment.'
