Market Update

Soufun: Rein-in policies yet to work

[Abstract] THE majority of China's real estate developers continued to register higher sale prices in the first half of this year as recent rein-in policies have yet to make an impact, industry research found.

Eight out of the 10 publicly traded developers on China's two bourses sold new homes at higher prices across the country during the first six months of this year compared to the same period a year ago, China's leading real estate information portal Soufun said.

It made this conclusion after studying interim reports released by the 10 companies, including industry leaders such as Vanke, Evergrande and Country Garden.

"Only two developers, Gemdale and Poly, recorded decreased sale prices during the January-June period while the other eight registered average growth of 27 percent," said Zhu Yinghua, an analyst with Soufun. "Our study has shown that across the country, new home prices maintained their northward trend and the recent rein-in policies introduced by the central government have yet to curb price growth effectively."

Guangzhou-based Evergrande Real Estate, China's top property seller by area in the first six months, recorded the biggest year-on-year price growth of 32.5 percent.

Evergrande was followed by China Vanke, the nation's best seller by value during the same period, whose new houses were sold 30.2 percent higher compared to a year ago, according to Soufun.

Average sale prices of new homes by Poly and Gemdale, meanwhile, dipped 4 percent and 7 percent, respectively.

China launched a series of tough measures since mid April to curb housing speculation. The policies mainly included higher down payments and mortgage rates on second and more homes.