Bank of China Warns Real Estate Will Cool In Q2

Bank of China released a report: the real estate market will cool further

Bank of China recently released "2014 second quarter economic financial outlook report "that in the second quarter of this year, the real estate market will cool further.

Bank of China Institute of International Finance, a senior analyst Zhou Jingtong think, in the second quarter, fiscal reform will accelerate the pace, while the real estate market or further cooling, the local government's objective function, behavior and willingness to invest is changing; overcapacity, rising costs and benefits decline etc., constitute a constraint on economic recovery in the short term.

Due to the tight real estate credit policy continued fermentation of the second quarter, the real estate market will cool further.

This year from January to February, the real estate investment growth has been a slight decline. Real estate investment totaled 795.6 billion yuan, down 3.5 percentage points over the same period last year. In addition, real estate (information, buy, forum) turnover also fell rapidly, housing a total sales area of 100 million square meters, an increase of 49.6 percentage points lower than the same period last year. Prices in some cities began dropping, and real estate development funding is also slowing.

BOC report reminded, for some time, the potential risks facing the economic development in three areas: U.S. quantitative easing QE withdrawal, local debt issues and the shadow banking.