Pre-Owned Home Sales and Prices Trend Down in May
(Beijing) — Sales and prices of pre-owned homes in Beijing reflected a downward trend in May, as stepped-up regulations aimed at cooling the capital’s red-hot property market began to kick in.
May’s average pre-owned home price fell 2.4% month-on-month. In ten out of 14 districts where transactions occurred, pre-owned home prices edged down, with gains in only four districts.
Some suburban areas such as Tongzhou district in Beijing’s east, and the Yizhuang Economic-Technological Development Area in southern Daxing district, have seen prices drop more than 20%, according to data from real estate agency B.A. & 5I5J Group Research Institute.
Online pre-owned property transaction registrations, better known as online signings — an indicator of home sales — plummeted 39% month-on-month to 10,219 units, falling for the second straight month, as of Monday.
Adding in new homes, the institute said that final online signings, would reach 10,923 units in May, their lowest level since March 2015.
Buyers have become less aggressive amid falling prices, opting for a “wait-and-see” attitude, Hu Jinghui, vice-president of B.A. & 5I5J Group, said in a note accompanying the data release.
Speculative buying of pre-owned properties has been contained as the city government’s restrictions started to produce results, Hu said.
The Beijing municipal government has rolled out numerous restrictions since March to cool runaway housing prices, including higher down-payment requirements and borrowing costs, as well as stricter rules requiring buyers to show proof of tax or social-security payments.
Down-payment requirements for second-home buyers were raised in March to at least 60% from an earlier 50%, and to a minimum of 35% for first-home buyers.
Eight major banks on May 1 scrapped previous discounts on mortgage rates for Beijing homebuyers. Rates for first-home purchases in Beijing rose to an annualized 4.9%, in line with the five-year benchmark interest rate set by China’s central bank. Second-home buyers must borrow at 5.88%, 20% higher than the five-year benchmark interest rate.
The proportion of pre-owned homebuyers paying a one-time sum peaked in Beijing over the first five months of this year, as higher borrowing costs resulted in more buyers paying lump sums rather than turning to banks for loans. The proportion of lump-sum buyers rose to 43% in May, compared with April’s 38% and March’s 29%. By contrast, the number of pre-owned property buyers using commercial loans dropped by 6.17 percentage points to 34% in May.
Hu said buying pre-owned homes with commercial loans has been an option for most buyers, but the number of buyers willing to borrow from banks dropped significantly due to higher loan rates and down-payment requirements.
Currently in Beijing, average per-unit prices of pre-owned properties rose to 5.33 million yuan, from 3 million yuan in 2015, according to the official China Securities Daily.
Contact reporter Pan Che (email@example.com)
May 18 06:47 PM
May 18 06:44 PM
May 18 06:39 PM
May 17 06:44 PM
May 17 05:41 PM
May 17 03:53 PM
May 11 07:05 PM
May 14 06:24 PM
May 14 06:01 PM
May 14 05:57 PM
May 13 06:45 PM
May 13 05:41 PM
May 13 05:07 PM
May 12 07:30 PM
May 12 07:27 PM
- 1Beijing Sends Another Signal That Property Tax Reform Is on the Agenda
- 2Apple Peels Off China Market Share From Sinking Huawei
- 3TikTok Owner Drops Alibaba Cloud Outside China
- 4U.S. Audit Watchdog Moves Closer to Enforcing Law That Could See Chinese Firms Delisted
- 5China’s Central Bank Seeks to Calm Inflation Jitters
- 1Power To The People: Pintec Serves A Booming Consumer Class
- 2Largest hotel group in Europe accepts UnionPay
- 3UnionPay mobile QuickPass debuts in Hong Kong
- 4UnionPay International launches premium catering privilege U Dining Collection
- 5UnionPay International’s U Plan has covered over 1600 stores overseas