Housing picks up on series of new policies

BEIJING — As Niu Motian's friends were enjoying gourmet dishes and showing off their new clothes during the National Day holiday, the white-collar employee in Beijing was conducting due diligence before buying something much more valuable.

"I believe it is time to own a home now," said Niu, who, despite looking at apartments since last year, remained undecided until days before the weeklong vacation that ended on Oct 7.

On the radar of the 30-year-old was a new residential compound located outside the Fourth Ring Road in southern Beijing. A property agent told her that more than 10 of the project's apartments were sold on Oct 1 alone.

"Housing prices have now dropped to a comparatively reasonable level, and mortgage interest rates have been lowered," Niu said, voicing her determination to seize the opportunity.

Like many others, Niu was incentivized by a string of stimulus measures unveiled before the National Day holiday in a bid to prop up the sagging real estate market, a pillar industry underpinning the world's second-largest economy.

These measures, rolled out by central government departments and many local governments, have reduced financial burdens on home buyers and relaxed or even eliminated restrictions constraining property transactions, making the past holiday a genuine "golden week" for housing developers and agencies.

Real estate agency Centaline Property estimated that over the holiday, more than 5,000 pre-owned homes were sold in Beijing, rocketing by over 150 percent year-on-year. New home sales tripled from the same period last year to nearly 2,000 units.

In Shanghai, sales of pre-owned homes from Oct 1-6 multiplied from the same period last year to 1,537 units. Potential home buyers flocked to visit new residential compounds. The other two first-tier cities — Guangzhou and Shenzhen — also witnessed a housing market boom.

In Hangzhou and Nanjing, two second-tier cities in East China, sales exhibits of multiple property projects were packed with potential buyers during the holiday.

During the National Day break, events were held in over 130 cities across China to promote housing sales and explain policies to the public. The number of visitors to most of the participating housing projects increased by more than 50 percent, said the Ministry of Housing and Urban-Rural Development.

This array of stimulus measures came after the Sept 26 meeting of the Political Bureau of the Communist Party of China Central Committee underlined efforts to "reverse the downturn of the real estate market and stabilize the sector".

The clear signal from China's leadership has served as a silver bullet to reverse flagging market sentiment.

Li Yujia, chief researcher at the Guangdong Housing Policy Research Center, expects this wave of impactful government support to cause a recovery in home sales.

"With the real estate market stabilizing in first-tier cities, the market in smaller cities around these metropolises will follow suit," Li predicted.

On the back of the stimulus package, housing prices in key cities are likely to stabilize, and the real estate market could be more dynamic in the fourth quarter of this year, said Chen Wenjing, director of policy research at the China Index Academy.

"To further stabilize property sales and home prices, there is still room to refine restrictive policies, and second-tier and smaller cities could raise subsidies for housing purchases," Chen said.

Xinhua