Home sales rebound on mainland
Property sales in major mainland cities rebounded last month, fuelled by price cuts and mortgage discounts for first-time homebuyers.
Sales of second-hand homes in Shenzhen surged to about 6,000 in March from 1,500 in January, according to data from Centaline Property Agency.
'One of the reasons is that banks offered discounts on mortgage rates, attracting more end-users,' said Andy Lee Yiu-chi, head of the Shenzhen branch of Centaline Property Agency. 'But the main driver is lower prices as developers and resellers have finally been cutting asking prices.'
The banks began to offer discounts on mortgage rates to first-time buyers after the Lunar New Year holiday at the end of January.
'Small banks in Shenzhen are offering discounts to buyers. The mortgage rate used to be about 6 per cent. Now it is about 5.8 to 5.9 per cent,' Lee said.
'Also, flat owners reselling their units cut asking prices by 10 to 15 per cent last month, which attracted end-users.'
Though property sales in Shenzhen had increased significantly in recent months, Lee said volumes remain far below the 12,000-13,000 deals recorded during the market peak in 2009 and the first quarter of 2010.
He expects sales to continue to increase this month and next as developers launch more projects for sale.
Dickson Wong, Centaline chief executive for its northern and southwest China operations, said the factors propelling sales in Shenzhen also had the same effect in Beijing.
'Banks' new mortgage offers helped property sales rebound in Beijing. Sales of second-hand homes increased by 100 per cent to about 10,000 in March, while sales in the primary market grew about 60 per cent.'
But Lee said the surge in sales would not be sustainable as the government was unlikely to relax restrictions on buying second homes.