Property Prices Climb at Growing Rate in China’s Biggest Cities
China’s biggest cities saw a faster increase in prices of new residential houses and second-hand homes in December, official data showed, as analysts said demand for housing in competitive school districts was further heating up the market.
In December, the prices of new homes across China’s so-called first tier cities — Beijing, Shanghai, Shenzhen and Guangzhou — grew in aggregate by 0.3% from the previous month, a slightly faster pace than the 0.2% month-on-month increase in November, according to data (link in Chinese) from the National Bureau of Statistics (NBS). Prices in Shenzhen dipped against the trend.
In midsize and smaller cities, the prices of new homes climbed at the same speed at 0.1% month-on-month growth in December as they did in the previous month, the data showed.
For previously occupied homes, prices in first-tier cities grew 0.6% month-on-month in December, a 0.1 percentage point faster than that of the previous month, while the prices in second- and third-tier cities increased by 0.1% and 0.2% month-on-month in December, the same pace as in November.
Xu Xiaole, a researcher with online real estate company Beike, said scarce educational resources drove price increases for previously occupied homes in the biggest cities. In China, living close to a school is sometimes a prerequisite to attend it, which can drive up property prices around the most competitive institutions.
Zhang Dawei, chief analyst at the Centaline research center, said demand for school district housing was on the rise amid the Covid-19 pandemic when many students cancelled plans to study abroad.
Sales were also on the rise. Data from Beike showed that in December, sales of previously occupied homes in Shanghai increased by 20.3% month-on-month and 95% year-on-year.
In the commercial market, however, more offices were empty in the South China tech hub of Shenzhen. Rent for top offices has been dropping there for two years as vacancy rates remain high, and experts say 2021 is likely to see this trend continue.
Rent in top office buildings in Shenzhen fell by 1.6% quarter-on-quarter in the last three months of 2020, marking the ninth straight quarter of decline and a 6.3% year-on-year drop, according to a recent report issued by real estate services provider Savills PLC.
Contact reporter Timmy Shen (firstname.lastname@example.org) and editor Flynn Murphy (email@example.com)
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