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Housing market to surge 2010
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China's real estate market saw rapid increases in the first quarter of the year. In Beijing, sales of pre-owned homes jumped thirty percent in the first three months compared to the same period last year. But as Niu Yun finds out, the rise in homes sales has also been accompanied by sky rocketing prices.
Official statistics show that first quarter sales of pre-owned homes, exceeded 47 thousand units, compared with 36 thousand in the same period last year. Real estate analysts believe an abundance of capital and high costs for land, contributed to the increases in prices and sales of pre-owned homes.
Li Wenjie, Deputy Director, Beijing Real Estate Agencies’ Accoc., said, "After policies regarding housing sales became more clear, many potential buyers made purchases. Secondly, a loose monetary policy adopted in 2009, helped boost sales. High land prices also made a contribution to the increases."
Regarding short term trends in the cost of housing, analysts say prices will continue to surge. But they note that the government could implement policies to curb an over heated market, as real estate prices rise dramatically in popular locations.
Li said, "Affected by rising sales and a flood of investors going into the property sector, the average prices in 2010 will be definitely higher than last year. If the prices continue to rise in a dramatic way, I believe the central and local governments could issue more control measures, especially in finance."
Last year, housing prices almost doubled in big cities, triggering fears about property bubbles and complaints from residents who can't afford to buy a home. The government has issued a series of measures since the end of last year to deal with the problems.
