Categorized | International

China Home Prices Continue Their Descent

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As the Chinese government continues to back their residential real estate restrictions, the housing market continues to experience a decline in pricing. Prices in China’s housing market fell yet again last month in the majority of the nation’s cities.

 

The Chinese Premier has stated that the current restrictions are necessary to prevent the growth of a housing bubble that could result in a seriously devastating crash. However, the current restrictions are taking its toll on the Chinese economy, and many international economists believe that the Chinese government has created its own economic crash.

 

With cement and steel production down due to lowered demand, and car sales growing weaker each week, it is evident that the market is struggling more than the Chinese government would like one to believe. Despite the declines in the previously mentioned industries, the Chinese Premier continues to be positive about the overall state of the economy, stating that it is stronger than ever.

 

The current restrictions are part of a two-year plan to control housing prices. They include regulations regarding down payments and mortgage rates, as well as restrictions on the purchasing of properties. The government is also trying to build millions of low-cost homes, which will surely cause a decline in real estate prices.

 

As prices continue to fall, many economists wonder exactly when the Chinese government will ease the restrictions that are in place, or even do away with them all together. Most analysts believe that China has not yet hit the bottom in terms of their residential real estate market. In fact, most don’t even know when the bottom will finally be reached.

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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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