Protests hit China as property prices fall
October 28, 2011 00:00:00
SHANGHAI, Oct 27 (AFP): Hundreds of angry home buyers launched a series of protests in China's commercial hub of Shanghai this week, as owners decried falling prices for their properties, state media said Thursday.
Hit by weak demand and lack of funding, developers have slashed prices for some new projects in the city by more than 20 per cent, the China Business News said, causing an outcry among those who bought at higher levels.
Analysts said the sometimes violent protests signalled that government measures designed to cool the red-hot property market were working and they warned developers in other parts of the country were starting to cut prices.
In the latest incident, some 200 home owners Wednesday besieged the sales office for a project of leading developer Greenland Group, demanding refunds.
"We require a refund because the loss we are suffering now is too great for us to afford," the Shanghai Daily quoted a protestor as saying.
He paid 17,000 yuan ($2,678) per square metre last year and claimed the developer had cut the price by around 30 per cent to boost sales.
In a another incident, 30 home owners stormed the sales office of a project of Hong Kong-listed China Overseas Land & Investment Ltd Wednesday, the Global Times said, repeating a similar protest from over the weekend.
In at least one case, protests have turned violent. Home owners smashed a glass door over the weekend at a sales office of Hong Kong-listed Longfor Properties Co Ltd for another project in a Shanghai suburb.
A property analyst said developers had started to cut prices in other parts of China, which could potentially lead to similar protests elsewhere.
"Property developers may be under pressure to sympathise with home buyers but if they have significant funding problems, they will opt to cut prices regardless," Su Yan of E-house China R&D Institute told the reporter.
She added buyers had little legal basis to demand refunds. "We can understand them on an emotional level, but actually the contract law does not support the demands by home owners."
