Rate cuts lure Chinese homebuyers back to market
Some local governments also cut transaction taxes and offer cash subsidies to stimulate demand
To gauge the buying demand among mainland Chinese for domestic and overseas residential properties, the South China Morning Post and consultancy Century 21 China Real Estate have partnered on a quarterly sentiment survey.
In the sixth poll conducted in Beijing and Shanghai in the second quarter, 181 Century 21 clients responded, compared with 243 in the first quarter.
The latest survey showed a rising proportion of mainland Chinese were returning to the housing market as the central bank had cut interest rates four times since November to make homes more affordable. Some local governments have also cut transaction taxes and even offered cash subsidies to stimulate demand as inventories hover at around record-high levels.
The result matches that of an official survey by the People's Bank of China in the second quarter, which showed 14.7 per cent of 20,000 households in 50 cities said they planned to buy a home in the next three months, up from 13.8 per cent in the first quarter.
The official survey also found that 51.5 per cent of the respondents regarded home prices as "unacceptably high" and only 3.6 per cent considered them "satisfactory".
More than half, or 53.9 per cent, expected home prices to remain stable in the next three months, while 18.2 per cent said they would likely to rise and 14.6 per cent anticipated a decline in prices.
Survey results on domestic demand
1. Do you plan to buy a home in the next three months?
Yes: 10 per cent (compared with 3 per cent in the first quarter).
2. What is the price you can afford and what is the price of projects you are looking at now?
Half (47 per cent) said they could afford a price less than 30,000 yuan (HK$37,960) per square metre, while 50 per cent (42 per cent) said they were looking at projects below that price.
3. Do you own a home and do you plan to sell it in order to buy a new one?
Sixty-four per cent (84 per cent) said they owned a home and 28 per cent (38 per cent) said they would sell it in order to buy a new one.
Survey results on overseas demand
1. Do you plan to buy a home abroad in the next three months?
Yes: None (compared with 1 per cent in the first quarter).
2. Why would you buy a home abroad?
Twenty-eight per cent (73 per cent) cited children's education for making such a decision, while 28 per cent (9 per cent) said it would be for emigration and 44 per cent (18 per cent) would do so for investment.
3. What is your main concern about buying properties abroad?
Half (32 per cent) said policy issues would be their main concern, while 31 per cent (58 per cent) cited prices.