Categorized | International

Beijing Housing Prices Drop 21%

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China’s residential real estate market continues to feel the impact of the restrictions set in place by the national government regarding the housing market. Housing prices in Beijing fell twenty-percent year-over-year in the first quarter.

 

Residential real estate prices will likely continue their descent throughout the year, as the national government has made it clear that they have no intentions of removing the current restrictions that are in place. The government is looking to deflate housing prices to realistic levels so as to avoid a major housing crisis as seen in the United States over the last five to six years.

 

The current drop in prices in the Chinese residential real estate market is the largest that the country has seen since the restrictions were imposed. They came as a result of developers slashing prices significantly so as to finalize more sales, and thus boost their market share.

 

Discount sales will likely continue in the coming months, and the average price will fall even further.

 

In addition to housing prices falling, housing sales also dropped substantially. The number of residential real estate properties sold in Beijing dropped more than fourteen percent, hitting its lowest mark in nearly five years.

 

Just a month ago, local government officials attempted to opt out of the imposed national restrictions. However, they were forced to abide by them after the national government threatened sanctions against the local municipalities.

 

The Chinese economy has suffered greatly from the imposed real estate restrictions, though the government believes that they are necessary to thwart off a greater economic crisis.

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About Nancy Raven

Nancy is the main writer for the International section of the website. Sometimes she also helps Drew out on the Finance/Mortgage section as well.

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