Mainland property sales growth slows
Growth in the mainland residential property market is slowing as government cooling measures are starting to have an impact, with residential sales rising 10.2 per cent last year, the slowest in three years.
National Bureau of Statistics data showed sales climbed to 4.86 trillion yuan (HK$5.98 trillion) last year, down significantly from the 80 per cent growth seen in 2009 and even the 14.4 per cent recorded in 2010.
However, the market still did better than in 2008, when sales dropped 20.1 per cent to 2.41 trillion yuan, after the central government introduced austerity measures to cool the red-hot market.
Last year, sales by volume of private property - both residential and commercial - totalled 1.1 billion square metres, up 4.9 per cent on the year, after an increase of 10.6 per cent in 2010. The residential sector, the main target of the government's cooling measures, slowed more than the rest of the market, with sales in the sector rising 3.9 per cent by volume last year.
Investors shifted their focus to investment properties during the year, with sales of retail and office space surging 12.6 per cent.
According to the statistical bureau, real estate investment increased 27.9 per cent to 6.17 trillion yuan, after growing 33.2 per cent in 2010.
The residential market is still developers' favoured sector, with about 72 per cent of real estate investment in the residential sector.
Investment in residential properties climbed 30.2 per cent to 4.43 trillion yuan.
Industry players said they had noticed a slight shift in focus.
'The property market has been hit by the [central government's austerity] measures,' said Alan Chiang Sheung-lai, the head of residential property at DTZ.
'Our data showed residential sales volume in terms of floor area in first-tier cities dropped more than 40 per cent last year, but sales in second-tier cities grew 5 per cent,'
Chiang expects sales in first-tier cities to rebound 20 per cent this year, but warned that property prices still faced downward pressure.
