Chinese developers balk at adding to their land holdings

Disappointing land auctions in Shenyang, Dalian, Zhuhai and Tianjin suggest that Chinese property developers remain hesitant to add to their land holdings despite signs of a rebound in the market, The Wall Street Journal reported. In Shenyang, approximately one-third of the properties offered for sale failed to meet the minimum asking price at auctions during the first half of the year. The trend does not bode well for local governments who rely on land sales for a large portion of their revenue. According to data from the Ministry of Finance, revenue from land transfers nationwide fell 27.1% year-on-year to US$212.1 billion in the first seven months of 2012. “It’s difficult to sell now. The government had to scrap plans for auctions, and has had to sit tight and see how things work out,” an official in Zhuhai said.