3 July 2009
China's decision to ease regulations on the property sector have generated significant price growth in recent months, causing fears that new property bubbles are starting to appear, according to reports in the country.
Property prices in Beijing's Central Business District appreciated by 6.5% in the past week alone, while brokerage Homelink says that residential demand in some areas of China is four times the supply, reports the China Daily.
Following a recent property auction, Pan Shiyi, chairman of developer SOHO China told the press: “The property bidders have gone irrational. A bubble in Beijing's property market is definitely there."
In Shanghai, luxury apartments are being sold for in excess of £9,000 per sqm, while in the southern city of Guangzhou, homes are being sold for close to the record high of £1,000 per sqm.
"One thing we are concerned about is whether there is a new bubble being shaped," the report quoted Gu Yunchang, secretary general of the China Real Estate Association as saying. "The possibility of a bubble is pretty big."
China’s property market slowed considerably in 2007, after the government introduced fresh measures to slow the rapid level of growth being recorded.
However, economic crisis encouraged the authorities to relax the market restrictions.
See Also: China (24), Marc Da-Silva (269), Overseas property investor news (42)
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