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BIZCHINA / Owning a Home
Majority says 'no' to buying property now
By Liu Jie (China Daily)
Updated: 2007-07-13 07:20
As property prices in China continue to increase despite government
measures to cool the market, the majority of respondents to a recent
China Daily survey said they will not buy houses amid spiraling prices.
The recent survey by the website www.chinadaily.com.cn showed that 685,
or 54.17 percent of the 1,266 respondents, said they would not purchase
property now, while 373 or 29.46 percent indicated they still want to
buy. The rest gave no comment.
Property prices in China's 70 large- and medium-sized cities jumped by
6.4 percent year-on-year in May, faster than the 5.4 percent growth in
April, despite government efforts to rein in the overheated sector.
Five cities saw a double-digit growth in prices for new homes. Shenzhen
led the pack with a 12.3 percent hike, while Beijing witnessed a 10.3
percent increase.
The majority of people choosing to not buy houses currently said they
simply could not afford the high prices.
"The price is unreasonable," said one respondent living in Beijing. "The
monthly salaries for my wife and I are around 10,000 yuan together, and
the average prices for commercial apartments on the Fourth Ring Road has
exceeded our total income."
Some said they believe that there is a bubble in the Chinese real estate
market and have adopted a wait-and-see attitude.
"I firmly believe the property bubble will be burst in two to three
years. After housing prices slump to a reasonable level, I will consider
getting my own house," one respondent said.
The reasons for people to select "no" in the survey seemed similar, while
causes for "yes" answers were more diverse.
Some of those willing to buy suggested that home values are increasing
faster than annual salaries.
"Why not buy now and increase your wealth?" asked one.
Another respondent felt lucky to buy an apartment years ago and be able
to witness prices climbing every year.
"I think buying a house as soon as possible is better - if I have the
money I will buy now of course," the respondent said.
Another participant agreed, noting that China has a large population with
limited land resources, so the conflict between land supply and
development will inevitably intensify and housing prices will certainly
increase further.
Some others chose to buy for personal reasons like marriage and
immigration.
An American respondent said that he married a woman in Dalian and would
like to settle down in China. "I am going to buy a flat in Dalian for my
new family, though it is too much money," he said.
Some respondents said they have invested in property due to recent
volatility in China's stock market, as real estate is seen as a more
stable investment channel.
Other respondents noted that current soaring property prices prevent
people who really need apartments from purchasing them.
"The government has taken measures to solve the dilemma, but there is no
obvious effect," said one respondent. "It is because the root of the
problem has not yet been found - what is the root?"
Some urged the government to find the fundamental reasons for rising real
estate prices and adopt policies to solve the problem, closely related to
people's lives and social development, as soon as possible.
(China Daily 07/13/2007 page15)
(For more biz stories, please visit Industry Updates)
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