[photopress:nightview_shanghai.jpg,full,alignright]Property agents and industry analysts forecast global investors are likely to keep pouring money into Chinese real estate in 2007, betting on long-term gains, despite efforts by the goverment to dampen speculation.
Public grumbling about the high cost of housing is a pressing concern for the ruling Communist Party and is sure to be aired at next month’s annual session of the National People’s Congress.
Wang Yong, an analyst with SouFun, China’s top real estate Web site, said, ‘Foreign investors will not reduce their activities in China, because they’re counting on the yuan going up.’
Interest is keen despite a barrage of disincentives. Already this year, the central government has started to enforce a dormant land appreciation tax, and speculation is rife that a general property tax — payable annually on a property’s value — is on the legislative drawing board. Last year Beijing increased capital gains taxes on real estate, required developers to build more cheaper homes and tightened rules on property purchases by foreigners.
Chris Brooke, president and chief executive officer for Greater China at property consultants CB Richard Ellis said, ‘A lot of speculative investors who had tried to use offshore vehicles now have moved out of the market, because it’s more difficult to invest in China. But the long-term investors, like the institutions, the investment banks, the funds … are still very interested in the long-term investment opportunities in China.’
Source: Reuters Italia