China city property prices hit new marks
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China's urban property prices rose by the most in 21 months in January and a land-supply shortage is unlikely to ease for some months.
Housing prices in 70 major cities on the Chinese mainland jumped 9.5 percent last month, the biggest year-on-year increase since May 2008, the National Development and Reform Commission, the top economic planner, said yesterday on its Website.
The January lift was the eighth in a row since last June, when property prices in the 70 cities monitored began to register growth following six straight months of decline.
"The country's property market didn't bottom out until last March and real estate developers continue to keep their prices high at the moment despite a contraction of volume and this helps explain the notable growth," said Chen Sheng, deputy dean of the China Index Academy, a major real estate research organization.
No incentives
"Most developers haven't seen any incentives for a price reduction because new home supplies remain largely inadequate around the country while demand still exists."
Chen said supply could usually be regarded as adequate if the stock of homes was able to withstand six months of sales.
However, in many Chinese cities, especially major ones like Shanghai and Hangzhou, present stocks would only last for as little as two months, Chen added.
The nationwide supply shortage, a result of slow property construction during the deep industry correction since late 2008 and extremely robust buyer sentiment since the second quarter of last year as the market rebounded, won't be relieved until at least the third quarter of this year, according to analysts.
On a month-to-month basis, property prices in January advanced 1.3 percent nationwide, the 11th consecutive gain. They rose 1.5 percent in December.
Shanghai rises
Across the country, prices of new and existing homes jumped 11.3 percent and 8 percent year on year in January, accelerating from the growth of 9.1 percent and 6.8 percent in December.
In Shanghai, property prices rose 8.8 percent last month from a year earlier and edged up 0.7 percent from December, the commission said.
Sanya and Haikou in southern Hainan Province registered the largest price growth for new and existing homes on both a year-on-year and month-on-month basis.
The cities benefited from a central government decision to turn Hainan into an international tourism showpiece.
Prices of new homes in Haikou and Sanya surged 35 and 31 percent in January from a year earlier, while those of existing homes jumped almost 30 and 28 percent duringthe 12-month period.
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