Secondary home sales perk up in Beijing and Shanghai after gains in prices slow down
Growth in secondary home prices boost transactions in November
An easing in price gains helped drive up transactions in secondary home markets last month in China’s top two cities -- Beijing and Shanghai, the latest SCMP-Century 21 index showed.
“The housing market towards the end of this year will buck the traditional trend of a slack season in winter time,” said property consultancy Century 21 China Real Estate, partner of the South China Morning Post for the monthly index.
The average asking price for existing homes in Beijing rose only 0.01 per cent, month on month, in November, slowing from October’s one-year record increase of 1.1 per cent.
The pace also eased in Shanghai to 0.6 per cent last month from October’s 1.6 per cent.
But they still marked the 15th and the 14th straight month of price increases in China’s capital city and financial hub respectively, under intensified government efforts to aid an industry still struggling against oversupply, particularly in small cities.
“In the secondary market, demand is mainly from end-users, including first-time buyers and upgraders,” Century 21 said. “For them, it’s still good time to buy at the end of this year.”
The SCMP-Century 21 secondary home price index stayed flat at 165 in Beijing and inched up to 154 in November from the previous month’s 153 in Shanghai.
Transactions of existing homes in the Chinese capital picked up 19 per cent in November from October to 19,468 units, reversing a three consecutive month of decline.
The central bank cut interest rates in late October for the fifth time in 2015, making it more affordable to buy homes. And expectations still run high that the authorities will soon roll out further measures, including tax rebates or cash subsidies, to sustain the housing market recovery, which is vital to stabilise the country’s slowing economy.
In Shanghai, secondary home sales also grew 18.9 per cent in November, month on month, to 39,933 units.
“A mild recovery in transactions will sustain in the short term,” said Century 21. “Home buyers will prefer large units as seen recently after the country announced to allow a couple to have two children.”
In year-on-year terms, existing home prices rose 4.9 per cent in Beijing last month to 43,349 yuan per square metre, and jumped 8.4 per cent in Shanghai to 37,134 yuan per square metre.
Transactions soared 57.4 per cent in Beijing last month as compared with a year earlier when the market was still in a downturn at the initial stage of government support measures. Sales rocketed 82.5 per cent in Shanghai in November from a year earlier.