Home News China April property sales post steepest drop since 2010

China April property sales post steepest drop since 2010

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On July 16, 2018, an unfinished building can be seen next to the 4th Ring Road in Beijing, China.Reuters / Jason Lee / File

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  • Real estate investment in April was -10.1% year-on-year, March was -2.4%
  • Sales by value-46.6% y / y vs -26.17% y / y March
  • The impact of lowering China’s mortgage rates may be limited-analysts

Beijing / Hong Kong, May 16 (Reuters)-China’s real estate sales in April fell at the fastest pace in at least 12 years. The biggest economy.

According to Reuters calculations based on released National Bureau of Statistics (NBS) data, real estate sales in April fell 46.6% year-on-year, the largest decline since at least 2010, sharp from a 26.17% decline in March. Expanded to. on Monday.

Real estate sales from January to April decreased by 29.5% year-on-year, compared with a 22.7% decrease in the first three months.

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Further cuts in mortgage rates for some homebuyers announced by Chinese officials on Sunday did little to convince investors and analysts that slumping real estate demand could be revived. .. read more

The sector, a major driver of economic growth, has been in a serious slump since last year after authorities cracked down on excessive borrowing by developers and surprised many homebuyers who were afraid that the project would not be completed. ..

Since the beginning of this year, more than 80 cities have taken steps to increase demand, including subsidies, lower mortgage rates and down payments.

But now, in dozens of cities, including Shanghai, the seventh week of the blockade, real estate outlook remains bleak as COVID-19 curtailment continues.

“Because mortgages aren’t expected to resume, it’s unlikely that you’ll buy a home for the first time, even if you lower the mortgage rate a little,” said Tin Lu, chief economist in China.

“We expect this reduction to be profitable, but the positive impact could be quite limited as strict anti-COVID measures appear to last for an unspecified period of time,” Lou said in a note on Monday. “.

He added that uncertainty, lack of confidence, rising unemployment and slowing income growth all contributed to the slump in new home sales.

Hong Kong Mainland Hansen Property Index (.HSMPI) It rose 1.2% in midnight trading, down from a 3.35% rise at the opening price.Wider market (.HSI) It decreased by 0.2%.

Nationwide real estate investment by developers increased 0.7% in the first three months of the year, followed by a 2.7% year-on-year decrease from January to April.

Real estate investment in April fell 10.1% year-on-year at the fastest pace since December, compared to a 2.4% decline in March.

New construction starts, measured by floor area, plummeted 44.19% year-on-year, the fastest pace since January-February 2020.

New construction starts fell 17.5% in the first quarter and then fell 26.3% year-on-year from January to April.

Real estate developers have lowered investor expectations for full-year sales after plunging 50% in the first four months, hoping that the market will bottom out in the second quarter. read more

“Sales recovery is the key to liquidity, without which policy effects would be discounted,” Citi said in a report. “For a faster recovery, more” real “measures are needed before a permanent loss on demand is needed. “

Japanese construction machinery manufacturer Komatsu (6301.T) In April, it reported a 16.6% decrease in machine use in China and a 17.3% decrease in March.

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Edited by Jacqueline Wong and Christopher Cushing

Our criteria: Thomson Reuters trusts the principles.

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