China’s property sales surged 60% by value in the first seven months of 2009, adding to concerns that record lending will create a real estate bubble. The National Development and Reform Commission said that home prices in 70 major cities advanced 1% year-on-year in July, the biggest increase in nine months. Despite the concerns, Premier Wen Jiabao has reiterated monetary policy will remain unchanged.
Xinyuan pleased with second quarter earnings
New York-listed Chinese property developer Xinyuan Real Estate posted a profit of US$3.9 million for the second quarter, down 71% year-on-year but still above expectations. The company, which saw its second-quarter revenue rise 4.7% year-on-year to US$91.8 million, raised its full-year earnings projection to US$23 million, from US$20 million.
Real estate investment hits $212.4b
Investment in real estate development in China came to US$212.4 billion in the first half of 2009, up 9.9% year-on-year. Investment in commodity-related residential buildings reached US$149.2 billion, accounting for 70.2% of the total figure.
BMI report predicts third quarter growth
A report released by Business Monitor International predicts that China’s economy will achieve respectable growth in the third quarter of this year as a result of successful stimulus implementation. However, housing prices were generally lower in the first quarter than in the first quarter of 2008, indicating that an oversupply is still working its way through the system.
Vanke raises $2.7b investment war chest
China Vanke, China’s second largest residential property builder, plans to raise US$2.7 billion through a share offering. The funds have been earmarked for investment, with US$1.3 billion to be used to finance 14 residential projects in southern China.
Minhang collapse spurs mandatory safety checks
From October 1, property developers in Shanghai have been ordered to carry out mandatory safety checks on all newly built apartments. The requirement comes in response to the collapse of a Minhang district residential high-rise on June 27. In addition, Shanghai’s municipal bureau of social housing and building will require developers to produce a certificate guaranteeing the quality of their apartments.
E-House high-end sales rocket in Q2
Real estate services company E-house sold only 20 high-end residential units per month in Shanghai, between January and April. However, sales rocketed to 182 units in May and 306 in June.
Shanghai increases development land supply
The Shanghai government plans to increase the supply of property development land in the second half of 2009 and also hike the construction rate of affordable housing for low-income families. The move is an attempt to alleviate the impact of inflation in the housing market. Mayor Han Zheng said he felt house prices had become "too high."