Money

Another good year for the local property market

(China Daily)
Updated: 2010-03-01 10:58

Li Wenjie, general manager of property agency Centaline China (North China region), speaks to METRO about the housing market in Beijing.

METRO: In 2010, what business strategies will developers take?

Last year, 1,300 hectares of land was supplied for residential development but many developers still haven't secured the land they wanted. With home prices skyrocketing, developers will continue to push for land. It can be predicted that competition in the land market will still be intense this year. At the end of last year, many developers regretted having sold homes earlier at lower prices. They would have recorded much higher revenues if they had waited. Developers may consider the market prices and sell at a slower pace this year.

METRO: What about the supplies of commercial housing this year?

Enough land for about 33.24 million square meters of housing space was sold between 2007 and 2009. After a couple of years of development, the new homes should have been put into the market between 2009 and 2010. With a booming housing market, we predict a stable supply of homes in the future.

As a means to boost the economy in 2009, a great amount of investment capital went into the commercial housing market, which contributed to the total trading volume. However, once the speculation demand falls with no significant change to prices, buyers who purchase homes for their own occupation will not be able to sustain rises in sales.

METRO: Will housing prices continue to soar?

As far as we can see now, prices have been rising like they have because of an inadequate supply, despite the polices to curb the real estate property. But the prices may not continue to soar as future supplies increase.

METRO: What areas will be prime locations?

The Luoma roundabout area in Shunyi, Olympic village, southern Beijing and the new towns will be the hottest locations. The Shunyi villa area along the Wenyu River has been developed for about 18 years. As the Shunyi District and new towns are undergoing development, the villa area may continue to expand.