China’s property market risks are rising, says data expert
Price trends in China’s housing market are unsustainable, according to Real Estate Foresight chief executive Robert Ciemniak who worries that excessive leverage among homeowners could lead to a crisis
Real Estate Foresight founder and chief executive Robert Ciemniak has made it his business to gather and interpret real time data on China’s residential property market. He gives his thoughts on what’s to come in China’s housing market.
What do you regard as the key indicators to watch when forecasting property prices in China’s major cities?
Our analysis shows sales volume growth tends to lead house price growth. But one must be wary of headline-only figures. For example, June national sales volumes growth was plus 14 per cent year-to-date, year on year. But the figure was minus 26 per cent for Tier 1 cities. Understanding policy shifts remains critical as the market continues to follow policy-driven cycles of easing and tightening.
To what extent are housing markets in different cities diverging in terms of prices and market forces?
Sales and price performance are highly divergent across city tiers and also districts of cities. Currently, the momentum is with the lower-tier cities, where prices and volumes are picking up.
China seems to have embarked on a plan to create several “megacities”; how do you anticipate developments like this affecting prices and the movement of people?