[photopress:real_estate_Guangzhou_1.jpg,full,alignright]The National Development and Reform Commission, the government’s main economic planning agency, reports that housing prices in 70 major Chinese cities jumped by 10.5% in November over a year earlier.
NDRC’s pricing director, Cao Changqing said the increase was the biggest monthly rise since the government began keeping track of that data in July 2005.
He said from January to November, housing price grew by 7.3% year-on-year, with price of new homes jumping 7.9%.
Meanwhile, the National Bureau of Statistics reports that despite government curbs meant to prevent runaway spending China’s investments in factories, real estate and other urban assets rose 26.8% in the first 11 months of this year.
Total investment in such fixed urban assets during the period was RMB10.1 trillion ($1.4 trillion).
The worry at government levels is that rising spending on factories, real estate and other projects could start a debt crisis if a glut of unneeded projects leads to widespread defaults on bank loans.
The January-November increase compares with a 26.9% increase in the first 10 months of the year, which is a very minor change despite the fact the government had enforced repeated interest rate hikes, reserve ratio increases and administrative decrees against increased lending for such projects.
Cao Changqing said, ‘Despite falling sales, housing prices in parts of Beijing, Shanghai, Guangzhou, and Shenzhen still remain high.’ But housing price is expected to remain stable as the macro-control policies are starting to yield results.
Source: People’s Daily Online