Are Beijing home price falling or not? Beijing mirrors U.S. housing market bust

Lots of charts in 北京房价到底降没降 take a detailed look at Beijing's housing market, slicing it into the different local markets.

The blue line is year-over-year price growth each month, while the chained growth shows a flat market with a small dip in November. The authors selected 39 representative projects in Beijing and found that 44% saw price decreases, 38% were unchanged and 18% saw price increases.

This next chart shows prices for various developers withing the 4th ring. Central Beijing has a ring system and although no on calls it a ring, the first is the Forbidden City. The next is the second ring. A lot of government buildings and famous tourist sites fall within it and land is obviously very expensive. The eastern part of the city is more developed, so prices are high even out to the fourth ring. At the moment, 5th ring housing is cheaper and it's far enough away that commute times start becoming a problem, even if one takes the subway.
The chart shows there was very little decline in prices within the 4th ring in Beijing last year. Note the highest priced development, a Vanke project, is pushing 60,000 yuan per sqm, more than US$9,000.

Fifth ring prices are also relatively stable, but there's a lot of different areas. In the east, it is more developed, in the west and south, less so. These are very different areas to lump together, but Beijing people do think in terms of rings. (If someone asks where you live, you might answer east 5th ring.)
Prices are generally down about 10% in the 5th ring.

Next up is Daxing, where prices slid as sales prices are too high. This area is in the south of Beijing, but not in the city proper, it is one of the southernmost suburbs more than 30 km away from the downtown.
The article said land prices are going for about 6000 yuan per sqm, but developers are asking for 20,000 yuan for apartments, which leaves room for further price declines.

Finally, there's Fangshan. This is 38 km away from downtown Beijing, to the west of Daxing. Fangshan replaced Tongzhou as the "hot" area of development in 2010.

Prices have taken quite a dip here, but there's still a gap between the 6000 yuan land price and 15,000 yuan selling price. Competition may drive prices lower, but there's less room for decline here than in Daxing.

How does this compare with the American experience? In the U.S., it was the outer regions that saw the largest price declines, the developments in the desert and a long distance from the city center (Arizona, California and Nevada were most typical). Therefore, the price declines in Daxing and Fangshan are a mirror of the U.S. post-bubble market and indicates the real estate bubble is bursting in a similar manner in Beijing.

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