BEIJING – China’s residential property sales rose in October, the first year-on-year increase of 2024, as the government’s latest stimulus blitz brought back buyers.
The value of new home sales from the 100 biggest real estate companies rose 7.1 per cent from a year earlier to 435.5 billion yuan (S$81 billion), reversing from a 37.7 per cent slump in September, according to preliminary data from China Real Estate Information. Sales surged 73 per cent from a month earlier.
The improvement came after China unleashed its strongest package of measures, including cutting borrowing costs on existing mortgages, relaxing buying curbs in big cities and easing downpayment requirements. That said, the recovery was lopsided, with state developer benefiting the most from the stimulus.
Home sales of six state-owned enterprises tracked by Bloomberg Intelligence rose an average 26 per cent, while falling 24 per cent for 13 private developers. This uneven recovery underscores how transactions are skewed toward second-hand homes and those developed by state-owned companies due to the lack of fiscal support, Bloomberg Intelligence analyst Kristy Hung said in a note on Nov 1.
Analysts are expecting more policy support to ensure China’s roughly 5 per cent economic growth target in 2024. President Xi Jinping reiterated the need to hit that goal in the lead up to a key legislative meeting next week.
International Monetary Fund director Kristalina Georgieva has warned that China’s annual growth could drop to “way below” 4 per cent in the future without reforms to lift domestic consumption. A years-long property crash has wiped out billions of dollars in household wealth, adding to deflationary pressures.
In late September, the trading hub of Guangzhou became the first Tier 1 city to remove all restrictions to buying residential property. The other top-tier cities Beijing, Shanghai and Shenzhen allowed more