China land supply up, sales down
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Play VideoChina's land market remained sluggish during the first half of this year. Many plots of land were sold at low prices, and other failed to sell at auction. But land supply in first-tier cities in China is increasing at a steady pace.
Land supply in Beijing has been on the rise. In the Central Business District, 9 blocks of commercial land - over 1 million square meters - will be released for sale on July 6th. It's set to be the largest land transaction in the capital. Other major cities, including Shanghai, Shenzhen and Guangzhou , are also increasing land supply. Data shows land supply in 120 Chinese cities in June surged over 30 percent on a yearly basis. And experts believe increasing land supply will help curb land prices.
Professor Dong Liming from Peking University,said, "Since land supply is sufficient, the increase of land prices will be restrained."
The abundant land supply may be good news for buyers, but has caused a downturn in land prices. 2.5 percent of land nationwide failed to sell at auction. And for successfully-sold land, the average prices are only around half the prices of last year. Property developers say, since the outlook of the real estate sector remains unclear, they are more cautions of purchasing land.
Mao Daqing, Vice President of Vanke said, "We are relatively careful about land purchasing. Because of the limit-purchasing and limit-price policies, and demand for houses becoming gradually stable, we have to make a reasonable estimate for future growth."
Data shows, in the first 5 months of this year, land transactions in 15 major home developers in China were only aroun! d 3 mill ion square meters. That's a year-on-year decline of over 70 percent. The difficulty of raising funds from banks and other financial institutions is also a major concern for developers when buying land.
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