China needs to take action to boost housing market
Friday, 12 September 2008
BEIJING, Sept 11 (Xinhua): China's present depression of housing market has aroused great concern in the public, and people are debating about whether the government shall take action to bolster the market.
Under the present cycle of economic slowdown, the country needs to start a campaign of "saving the housing market" calling for micro adjustment of some policies, said an expert.
But some people said that the real estate sector's fall was not serious enough for the government to take action. Experts attributed the unfavourable response to the sound business conditions of banks. The leading commercial banks in China still posted solid earnings in the first half.
The largest lender, the Industrial and Commercial Bank of China (ICBC), said Thursday its first half after-tax profits totalled 64.88 billion yuan (9.47 billion US dollars), which made it the world's most profitable bank.
However, some local governments including Xi'an and Shenyang cities as well and Henan province have taken measures to help boost the housing market. The measures taken by local governments are aimed to encourage purchase of housing. The government of Xi'an city in northwest China's Shaanxi province issued the proposals on resuming development of real estate, deciding to give government subsidies to people who have bought commercial apartments.
The subsidies cover new apartments with construction area ranging from less than 90 square metres to less 144 square metres, and second-hand housing, with the subsidies accounting for 1.5 per cent of the total amount of money for the purchase.
Statistics show that sales volume and price of housing have dropped in Xi'an this year. In the first half of this year, sales of areas of new apartments dropped 20 per cent year on year, and the average price of residential housing was 4,340 yuan per square meter, up 10.8 per cent year on year, but the growth was 2.08 per cent lower than the same period last year.
At the same time, Xi'an also give fee reduction treatment on supporting infrustructure facilities for real estate developers. Shenyang city government has also published a series of "market warning" policy including subsidies to housing purchase, and adjusting housing prices.
Central China's Henan province said that it will take preferential policies for purchase of housing. When local governments have one after another taken action to "save the market", some experts give the warning three possible risks.
Under the present cycle of economic slowdown, the country needs to start a campaign of "saving the housing market" calling for micro adjustment of some policies, said an expert.
But some people said that the real estate sector's fall was not serious enough for the government to take action. Experts attributed the unfavourable response to the sound business conditions of banks. The leading commercial banks in China still posted solid earnings in the first half.
The largest lender, the Industrial and Commercial Bank of China (ICBC), said Thursday its first half after-tax profits totalled 64.88 billion yuan (9.47 billion US dollars), which made it the world's most profitable bank.
However, some local governments including Xi'an and Shenyang cities as well and Henan province have taken measures to help boost the housing market. The measures taken by local governments are aimed to encourage purchase of housing. The government of Xi'an city in northwest China's Shaanxi province issued the proposals on resuming development of real estate, deciding to give government subsidies to people who have bought commercial apartments.
The subsidies cover new apartments with construction area ranging from less than 90 square metres to less 144 square metres, and second-hand housing, with the subsidies accounting for 1.5 per cent of the total amount of money for the purchase.
Statistics show that sales volume and price of housing have dropped in Xi'an this year. In the first half of this year, sales of areas of new apartments dropped 20 per cent year on year, and the average price of residential housing was 4,340 yuan per square meter, up 10.8 per cent year on year, but the growth was 2.08 per cent lower than the same period last year.
At the same time, Xi'an also give fee reduction treatment on supporting infrustructure facilities for real estate developers. Shenyang city government has also published a series of "market warning" policy including subsidies to housing purchase, and adjusting housing prices.
Central China's Henan province said that it will take preferential policies for purchase of housing. When local governments have one after another taken action to "save the market", some experts give the warning three possible risks.