China - Housing 01 (May 08 - May 10)

[millionairemind]

Real estate sales up, prices soar
By Hu Yuanyuan in Beijing, Zhou Yan in Shanghai and Zhan Lisheng in Guangzhou (China Daily)
Updated: 2009-07-03 07:52
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The real estate market is quickly turning hot.

On Monday, for instance, a land parcel along Beijing's Guangqu Road was auctioned off for more than 4 billion yuan ($585 million) after fierce bidding among major developers from the mainland and Hong Kong.

The price set a record for a single land parcel in Beijing.

More dramatically, just 15 months ago, this land parcel was withdrawn from a public tender due to a lack of bidders.

"The bidders have gone irrational. A bubble in Beijing's property market is definitely there," said Pan Shiyi, chairman of property giant SOHO China, who was also a bidder that day, after the latest auction.

This "bubble" is being felt in the real estate market in major cities across the country.
http://www.chinadaily.com.cn/bizchina/2 ... 351912.htm

[winston]

Yes, it's getting crazy in BJ.

I went to see a few developments and they hiked the price by RMB5000 per sq m, since the last time I saw them a few months ago.

My friend just bought a place. It was built already so it's safer. You can see what you are buying. It's next to a lake in the Central South area. Not cheap. Going at RMB 24,000 per sq m and "Mau Pi" ie. it's a renovator's delight.

BTW, if you are buying in BJ, the East is the best area ie. Chaoyang Garden. Too far South is not too good. The water quality there is supposedly not too good. In addition, that's the tougher part of town...

[winston]

New bubbles rising in China property market

BEIJING : China's recent moves to ease curbs on the real estate sector have sent prices soaring recently, stoking fears that new property bubbles are forming, state media reported Friday.

Residential property prices in Beijing's Central Business District rose 6.5 percent in the past week and demand for second-hand houses in some other areas is four times the supply, said the China Daily, citing brokerage Homelink.

It said a land parcel in Beijing, which was withdrawn from a public tender due to a lack of bidders only 15 months ago, was auctioned off Monday for a record 585 million dollars.

"The bidders have gone irrational. A bubble in Beijing's property market is definitely there," Pan Shiyi, one of the bidders that day and chairman of leading developer SOHO China, said after the auction, according to the report.

In Shanghai, developers of the luxury Tomson Rivers apartments, priced at over 14,600 dollars per square metre (about 1,360 dollars per square feet), sold at least 10 units in June, the report said.

That compared with sales of only four units since the project was marketed four years ago, it added.

( Not entirely true. There was a scandal and that project was moth-balled for a few years. People also do not like that building as there's a road behind that building, that is being used by the local tourists going to the Pudong Bund and the Ferry. That road is very noisy, full of local tourists and there's also a lot of small road side stores. Very "chap" .. )

In the southern city of Guangzhou, the downtown housing price reached 1,600 dollars per square metre in May, close to the record high of 1,700 dollars in October 2007, the report said.

"One thing we are concerned about is whether there is a new bubble being shaped," the report quoted Gu Yunchang, secretary general of the China Real Estate Association as saying. "The possibility of a bubble is pretty big."

China's house prices have been rising fast in recent years with the country's economic boom.

The trend accelerated in 2006 and 2007, partly spurred by a growing stock market that prompted investors to place their windfalls in property.

As a result, the average home price in Beijing was 23 times a local family's average income in 2007, compared with levels of four to six times average incomes internationally, state media reported.

Fears the property market would suddenly collapse, Beijing launched a number of measures from September 2007 to curb speculation, including raising downpayments on second homes and banning loans to developers for land purchases.

The policies affected the industry severely, causing sales to slump and house prices to drop in dozens of major cities.

However, the financial crisis has forced authorities to relax the curbs, with local governments relying on preferential policies to boost demand.

Stamp tax on property purchases and value-added tax of land on property sales was lifted from November 2008 and minimum deposits for first-time home buyers was also slashed.

- AFP /ls

[winston]

After Chinese Property share prices have tripled, the experts are asking you to buy ..

DJ MARKET TALK: China Property Plays Down; Good Entry Level - GS

1142 [Dow Jones] China property plays extend their recent falls amid uncertainty over potential policy changes, after China government urges banks in Hangzhou to follow 40% down payment requirement for second home buyers vs 20%-30% previously applied.

"We were not surprised by this move from Hangzhou CBRC (China Banking Regulatory Commission) as we had already seen a similar move by CBRC Shanghai and Beijing two months earlier," says Goldman Sachs. Adds, this indicates CBRC intends to improve credit control over mortgage after witnessing rapid property price rise over past few months.

( If not surprised, how come you did not come out with a Research Report to warn people ? )

House says profit-taking provide good entry level. Keeps Attractive view on sector, rates Agile (3383.HK), Shimao (0813.HK), R&F (2777.HK), Shenzhen Investment (0604.HK) among HK-listed counters at Buy. Agile down 0.8% at HK$9.57, R&F down 3.3% at HK$15.88.

[millionairemind]

July 10, 2009
China housing prices rose in June

BEIJING - PRICES paid for homes in China rose in June for the first time in seven months, adding to signs the world's third-largest economy might be rebounding from its slump, according to data reported on Friday.

Housing prices in 70 large and medium-size cities rose 0.2 per cent in June from a year earlier and by 0.8 per cent compared with May, the Cabinet's National Development and Reform Commission reported.

Economists have pointed to increased activity in residential and commercial real estate as signs China is emerging from its slump as Beijing's 4 trillion yuan (S$855.7 billion) stimulus plan pumps money into the economy.

Real estate also is expected to help drive a recovery as sales circulate money through the economy and families spend to furnish new homes.

Other indicators also are improving. June bank lending was more than double the May level while retail sales, investment and factory activity have been rising.

After years of double-digit increases, prices paid for homes in China fell for the first time on record in December, declining by 0.4 per cent. Prices suffered their biggest decline in March with a 1.3 per cent fall from a year earlier. -- AP

[winston]

DJ MARKET TALK: UBS Upgrades China Overseas, Guangzhou R&F To Buy

1202 [Dow Jones] STOCK CALL: UBS upgrades both China Overseas (0688.HK), Guangzhou R&F (2777.HK) to Buy from Neutral after revising China home price forecast to rise 20% for 2009-10 combined vs previous 5% rise forecast for 2009, 2010.

Stays upbeat on China's property market; says capital raising lowers liquidity pressure on developers, allow them to hold properties for higher prices.

Adds, end-user, investment appetite help cut inventories considerably. Lifts COLI target to HK$24.9 from HK$14.25. Raises Guangzhou R&F target to HK$24.7 from HK$16.32. COLI +2.3% at HK$17.16, R&F +2.9% at HK$16.44. HSI +1.4%

[winston]

From UOBKH:-

Our channel checks on second home policies

We expect second home policies to be near-term overhang and excuse for profit-taking in the sector, but still do not expect central government to reverse its supportive policies in the near term. Maintain OVERWEIGHT

[kennynah]

i can never quite understand all these terms...overhang, underweight, outperform, underpants, oversex, etc... knn...cant just use simple words meh ? eg...over supply, too expensive, cheap now...like dat lah....

[winston]

And if you are like one of those lemmings that are running out to buy a property in China, be careful ...

A friend of mine just bought a property in BJ about 6 weeks ago. He was very happy...

After paying the downpayment ( 30% ) about 6 weeks ago, he still cant get a mortgage. And the reason why he cant get a mortgage is because the license of the Property Developer has expired. And without that license, the Property Developer cant signed a contract with him ....

Please understand the rules first before you play in another market ...

[kennynah]

why didnt you advice him?