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The analysis of China estate market From the actual operation of the estate market in China since 2007 to this year, we can draw a conclusion that the China's property market has turn into the downside of this round of real estate cycle phases,as some industry experts called "inflection point". At present our country real estate exists serious structural imbalance between supply and demand. 1.Small and medium-sized model in the low price of ordinary commercial housing and economic affordable housing are in short supply, but high-end housing are glut.According to Construction Department statistics,in early 2006, 40 major cities the bigger area which below 90 square meters of new commercial housing accounted for 19.18%.In October 2007, this proportion had increased, but only 25.77%which keep a larger gap with the current policy. 2.Very little supply of low-rent housing and government attaches little importance to it. At the same time the supply of affordable housing can not meet demand.Besides affordable housing which the government give priority to provide has a lot of problems. In 2004-2007 investment growth rate of 29.6%, 20.9%, 29.6% and 20.9% respectively. And house prices rise is too fast, in 2004-2007, the average house prices rise 14.4%, 6.5%, 5.5% and 9.7% respectively.The house prices are to high to afford for normal people.So we can see there is a big bubble in China. In 2006-2007, rapidly rising prices make investment and speculative demand increased rapidly, which caused the soaring house prices and land prices have appeared in the common phenomenon. Therefore, in 2007 the government introduced a series of special regulation policy for real estate.For instance,"the second set of housing" as the tightening of monetary policy make a great effect on property.The capital of the real estate market suddenly decrease;the investment and speculative demand was major blow;a lot of funds left and the demand began to shrink. While in this year,the government has canceled the second housing limit lending in almost cities.But the normal people hold a wait-and-see attitude who are not optimistic to property as last years. Many people think China property bubble must be burst in recent years.However I have a completely different opinion that the housing market will enter a adjustment, but it will not burst.Because the real estate is a pillar industry and Chinese government has strong and powerful macroeconomic regulations. So the government does not allow housing prices collapse and will try its best to make property to a soft landing.What’s more the fundamentals of the economy in our country does not go bad and factors supporting house prices still exist.China estate just will stay in adjustment for about 2 years.In long-term China's housing market supply is still tight.The prospect of the future is also very good. It’s a good time to invest some companies which are competitive and have abundant funds.These companies will go through a down ward but own a bright future. |
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