Foshan leads the real estate rally among Greater Bay cities as speculators get ahead of curve

Foshan, an industrial city next to Guangzhou, has experienced the biggest gain in property prices in the last 18 months among the 11 cities in the Greater Bay Area plan, according to an index by Hong Kong property agent Centaline Property.

As of January, prices for new and used homes in the city have risen 35 per cent since July 2017, according to the Centaline Greater Bay Area Index. Zhaoqing ranked No 2 with a 22 per cent gain, followed by Jiangmen with a 16 per cent gain and Hong Kong with a 6 per cent rise. Zhuhai was the only city that saw a decline, with prices dropping 4 per cent over the 18-month period to January.

The index uses a baseline calibrated at 100 on July 2017, tracking nine mainland cities and Hong Kong and Macau under the Greater Bay Area. Both new and second-hand properties are measured in the index, weighted by the annual GDP of each city.

“Since 2017, Guangzhou has introduced strong purchase restrictions. Plus, Foshan’s property prices are around half of that of Guangzhou, so some customers have turned to Foshan,” Terence Law, senior principle project director at Centaline said.

Foshan, formerly known as a manufacturing hub for air conditioners and refrigerators, has benefited from the development plan linking the city and its neighbour Guangzhou to form a mega-city, he said.