A recent report by China International Capital Corp. (CICC) warned of falling sales, investments and new construction in the country’s property market next year, as years of booming growth appear to be coming to an end, Caixin reports.
The assessment forecasts that real estate sales will fall for the first time in five years in 2019, in terms of both floor area and prices. The drop could be as large as 10%, the report said, with China’s third- and fourth-tier cities bearing most of the brunt.
There have already been the first signs of a slowdown in the property sector. Real estate investment growth fell to 8.9% in September from 9.2% in August, and sales by floor area were down 3.6% from a year earlier.
Weak sales during the traditionally active ‘golden’ period of September and October led developers to slash prices and even throw in freebies such as cars to attract buyers. Protests sprung up in some cities when homeowners saw similar properties being sold at a 30% discount.
The report also predicted investments to decline by 5% next year and new construction to drop 10%. One of China’s largest developers, China Vanke, recently said that “survival” was its main goal in the next three years as it seeks to weather a “turning point” in the industry.