Shimao Property said yesterday Beijing would lift some restrictions on buying property in the middle of this year.
The government's credit tightening policy has not only put liquidity pressure on developers but also on first-time homebuyers, who have had difficulty securing loans.
'The real estate market is hit hard by falling sales because genuine homebuyers are facing difficulty in getting bank loans,' said Lawrence Hui Wai-man, the chief financial officer at Shimao. 'We believe the central authorities will relax mortgage lending as early as May in a bid to help first-time homebuyers. But the restrictions on the number of home purchases will remain in place.'
To boost sales, Hui said, developers had stepped up price cuts in the past quarter.
'We cut our prices by about 10 per cent for new projects, mostly in second and third-tier cities,' he said.
Despite the depressed market, Shimao recorded a 0.65 per cent rise in contract sales to 30.7 billion yuan (HK$37.7 billion) last year, with average selling prices 6.5 per cent higher at 12,845 yuan per square metre.