Mainland China property market expected to see better balance of demand and supply
Suzhou, Hangzhou and Hefei among cities with lowest inventories
Mainland China’s property market rebounded in the second half last year and analysts expect a positive 2016 as a glut in inventory has declined and the market is likely to be increasingly supported by easing policies.
“The clearance of inventory will speed up this year as new construction dropped last year and the market momentum is not bad in the light of the supportive policies,” said Carol Wu, head of China research at DBS Vickers.
She said she expected new home sales to grow by 5 per cent to 10 per cent this year.
The central government included destocking among its five economic targets for 2016 after President Xi Jinping urged the reduction of property inventory at a government meeting in November to ensure the sustainable development of the property sector.
Many developers stepped up the clearing of existing inventory and slowed down investment last year.
The inventory has been drawn down a lot compared to the beginning of last year
As a result, newly started property construction fell 14.7 per cent year on year in the first 11 months of 2015, according to the latest official data.
