China’s property market is still witnessing a slowdown, as home prices dropped for the third straight month, while the average value of residential properties across 100 cities declined to CNY8,832 (S$1,807.30) per sq m last month.
In the 10 first-tier cities such as Shanghai and Beijing, house prices fell 0.36 percent month-on-month to CNY15,663 (S$3,205.63) per sq m.
Earlier this year, the government implemented cooling measures to test and control the property sector. The measures included imposing annual property tax in selected cities, restricting foreigners and locals from having more than one or two homes respectively and requiring home buyers to pay a minimum down payment of 30 percent of the price for the first property and 60 percent for a second one.
Down payment for second-hand properties, which could range from 40 to 60 percent, depends on the age of the property.
Other policies that contributed to the slowdown of property sales and prices include imposing full business tax on properties that are resold within less than five years of acquisition and making sure banks impose mortgage rates at 1.1 times the benchmark lending rate.
Yu Tat Loong, Chief Operating Officer of Shanghai Firstreach Real Estate, noted that China still has a great deal to offer developers, despite the government’s drastic measures.
“We will still expand our operations here because long-term wise there is room for development even in first-tier cities and especially so in second and third-tier cities,” he said.
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