(Source: Business Insider) – Despite the official data suggesting that home prices aren’t really falling much, there are something rather more interesting that I have been reading and hearing for a while now.
Since probably a month or two ago (or perhaps longer?), there are various reports suggesting that prices in the primary residential market are getting cheaper than secondary residential market, i.e. new homes are getting cheaper than second-hand properties. This was particularly true for those in the fringe areas of big cities, but there are more and more such anecdotes in more and more cities. Apple Daily in Hong Kong points out that the phenomenon is getting more widespread in cities like Beijing, Shenzhen, Shanghai, and Guangzhou, and in other second-tier cities like Tianjin, Chongqing, Wuhan, Ningbo, etc. This is not very usual, but that is pointing to something rather more ominous. In the meantime, unsold flats in Beijing (including flats available for pre-sale and completed flats) amounted to 108,181 units according to Xinhua. Aggressive administrative measures have taken the steam out of the market, leading to low transaction volume and accumulating unsold inventories even though prices aren’t moving very much, even with increases in some places.
Source: Business Insider
Aug. 29, 2011, 5:52 AM
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