While analysts foresee a sharp drop in China’s property market overall, the rate of increase for new home prices in Xi’an has been among the country’s top three for seven months in a row – and there’s reason to believe that prices will continue to rise.
Xi’an’s new-home prices in February rose 24.2% year-on-year, the highest rate among all 70 mid- to large-size cities surveyed, according to the National Bureau of Statistics. This is the third month that the city’s data has been on top of the list.
According to local real estate consulting firm Meicheng, Xi'an’s government and real estate companies completed 30 land transfer deals in January alone, with total associated fees increasing 301% year-on-year to 17.6 billion yuan ($2.62 billion). The local monthly average new-home price recorded in the same month was 4,291 yuan per meter square, up 71% year-on-year. In 2018, the Xi’an municipal government’s land supply to homes increased 34.47% year-on-year.
Analysts believe the price increases may be due to the northwestern city’s land and development policies that encourage personal real estate purchases. Xi’an has also rolled out policies offering fast-track residence approvals designed to lure talent to the city – and some market watchers therefore believe that there is still room for new-home prices in the city to grow.