Pre-owned Home Prices Drop 13% in Beijing After Launch of Property Controls

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Pre-owned home prices in Beijing fell by more than 10% during the period from the launch of housing market control policies in March until the end of 2017.

17 March marked the start of Beijing municipality’s property control campaign, with over 20 associated policies released in the following months, including lending curbs and sharp hikes to down payment requirements.

Xu Jianyun (徐贱云), the chair of the Beijing Commission for Housing and Urban-rural Development, has since revealed that pre-owned homes in Beijing have seen prices fall by 13% during the period from 17 March to the end of 2017.

According to official data the average price for new commercial residential housing in Beijing in December was 37,800 yuan per square metre, for a year-on-year decline of 0.9%.

The average price for pre-owned homes had fallen to 59,100 yuan per square metre, for a decline of 1.2% compared to December 2016, and a fall of 13% compared to the latest peak hit in March 2017.

Xu said that controls on the housing market will remain “unshakeable” in 2018, and that the municipal government will continue to maintain strict curbs on Beijing’s real-estate market.

According to Xu the Beijing municipal government will uphold its stance that “houses are for occupation, not speculation,” to ensure the stable and healthy development of the Chinese capital’s real estate market.

Xinhua reports that local authorities have hit real estate agencies hard in 2017 for legal infractions, shutting down over 300 companies for regulatory breaches in 2017.

Beijing is also introducing new policies to shape the long-term development of the municipal real estate market, including efforts to expand the leasing market and joint property rights housing.

The municipal government has set a target of 1.5 million new homes over the next five years, in a bid to dramatically ramp up supply.

Since the launch of the joint property rights housing policy on 30 September 2013, nearly 7,300 related home units have been added to the  market in the Chaoyang, Shunyi and Changping districts of Beijing.

The policy envisages the provision of 250,000 join property rights homes in Beijing by 2021, in order to satisfy demand for housing amongst ordinary citizens and stabilise market expectations.

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