Xinhua reports that investment in China’s real estate sector rose 24 percent in July compared with the same month last year. The figures are from the National Bureau of Statistics (NBS). Investment in mid-range housing rose 29.2 percent while investment in affordable housing was up 5.7 percent.
The report registers a slight increase in the real estate climate index, showing that the real estate market is still hot despite a series of government measures to tighten tax, and restrict loans and land allocation.
One way of measuring the rise is the use of the real estate climate index which is a little complex. It is a composite index reflecting the current real estate market situation in China and development trends. The sub-indices include investment, source of capital, the floor space of marketable yet unsold buildings, areas of land developed and the floor space of buildings under construction. Complex but a good indicator.
In July the index stood at 103.51, up 1.54 over the same month of last year and 0.58 higher than June. That is the fifth consecutive month-on-month increase since March. The government has reacted to this with new measures. It wants to cool the market down and it is doing this by tightening property lending and banning loans to property developers whose self-financing is less than 35 percent of their investment.