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SG China home prices continue to rise

Property Here - Thursday, June 20, 2013

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Home prices in China’s largest cities in May posted their highest annual growth rate in over two years, according to calculations by The Wall Street Journal based on data from China’s National Bureau of Statistics.

Average prices of newly constructed homes across 70 major cities increased 5.3 percent in May compared to a year ago — up from 4.3 percent in April 2013 and their highest growth since March 2011.

“There are still a relatively large number of cities showing price increases,” said the National Bureau of Statistics. “Property market adjustment policy still needs to be firmly implemented.”

On an annual basis, prices rose in 69 cities in May compared to 68 cities in April. On a monthly basis, 65 of the 70 cities recorded hikes in new home prices in May, down from 67 cities previously.

“What’s driving this is the expectation that prices are going to go up, which causes anxiety among people to transact quickly,” said Michael Klibaner, Head of research at Jones Lang LaSalle China.

“The price growth indicated resilient demand for residential properties,” noted Frank Chen, China research head at CBRE.

In addition, a key reason behind the continued uptick in prices is that only Beijing implemented a 20-percent capital-gains tax on some second-home sales, a measure that was announced by China’s State Council in March.

“The poor implementation at the local-government level of the 20 percent capital-gains tax also reduced the impact of the March measures,” added Chen. 



Nikki De Guzman
, Junior Reporter at PropertyGuru, wrote this story. To contact her about this or other stories email nikki@allproperty.com.sg