Covid-19 lockdowns: Chinese housing market set for more hardship after price cuts and government easing measures fail to boost sales during labour week holiday
- Sales of new homes in 23 major Chinese cities plunged by 33 per cent year on year by area during the five-day holiday period: CRIC
- ‘Job security has become the major concern, rather than owning a home’, Centaline executive says
The country’s economy has been hit hard by its latest Covid-19 outbreaks, and many companies have been forced to close down because of long lockdowns, such as those in Shanghai. This has created uncertainties about jobs and employment.
“Home buying has been deterred by economic uncertainties. People would prefer to save money for a rainy day, in case they are sacked,” said Andy Lee, CEO for southern China at Centaline Property Agency (China). “Job security has become the major concern, rather than owning a home. What most people are worrying about is their mortgage-repayment ability, particular in second or third tier cities,” he said.
“Even banks cutting interest rates and developers offering bigger discounts may not stimulate buying desire,” Lee added.
This pessimistic outlook comes after the sales of new homes in 23 major Chinese cities plunged by 33 per cent year on year to 970,800 square metres during the five-day holiday period, China Real Estate Information Corporation (CRIC) said last week.