2014-07-29

CASS Researcher: Real Estate Collapse in Second and Third Tier Cities Possible

Ni Pengfei, Director of the Urban and Real Estate Economy Research at the Chinese Academy of Social Sciences (CASS) and also the Director of Center for Cities and Competitiveness, says a collapse in some eastern second and third-tier cities is "entirely possible," though a national collapse is unlikely. Another researcher said housing demand won't peak until between 2020 and 2025.

Ni also said the lifting of buying restrictions would have little effect, though he said first-tier cities such as Beijing and Shanghai would not lift restrictions because a lot of speculative money would come into the markets there, wiping out years of efforts to limit price increases.

社科院专家:部分二三线城市楼市崩盘完全有可能
Chinese housing market fell short inevitable, ordinary commodity housing prices will enter a period of 2-3 years of adjustment.

Yesterday, the Academy of Social Sciences Institute of Finance strategy, urban and Competitiveness Research Center released in 2014, "China Housing Development (interim) report" in Beijing, revealing view.

Although overall not collapse, but the editor of the report and director of the Academy of Urban Competitiveness Research Center Ni Pengfei believe that some of the higher prices rise, the amount of the early development of second and third tier cities in the eastern part of the larger "collapse entirely possible. "

Experts predict that the property market turning point will appear in 2020-2025 between.

Stage into a structural surplus property

Summarizes the characteristics of the housing market in the first half of this year, Dr. CASS Institute of Finance Strategy Zoulin Hua believes that large and medium cities showing the initiative to adjust the situation, the national property market into structural surplus stage.

January of this year, 70 cities, prices fell only 6, to June, a decline of cities has increased 55, fell face rapidly expanding, albeit still limited, only a city of Wenzhou rates price fell below the same period last year.

The National Housing turnover shrinking significantly in the first half of this year, the first half of this year, China commodity housing sales area and sales fell by 7.8% and 9.2%, respectively.

With sluggish sales and medium-sized cities nationwide housing prices declined slightly, 邹林华 said, the real estate business capital returns slower, development and investment growth continued to decline, to the first half of this year, the growth rate has dropped to 13.7 percent year on year.

The slowdown of the property market over the next decade

Whether prices will collapse? Zoulin Hua believes that the market in the short term active adjustment is inevitable, but it will not enter the ongoing recession and depression, "ordinary commodity housing prices will enter a period of 2-3 years to adjust."

Ni Pengfei further analysis, the overall property market collapse will not occur, but the "partial collapse is entirely possible." He believes that as housing prices rose too high, excessive pre-development of second and third tier cities, it could collapse, such as , Wenzhou, Zhejiang Province, in addition to some of the city outside, it is more risky.

"In the long term, the next ten years the property market slowdown in demand growth in 10 years." Director of the Academy of Social Sciences Research Center for City and Competitiveness Ni Pengfei said.

Then, when the property market will be the turning point? CASS Institute of Finance assistant researcher Dr. Li Chao strategy based on estimates believe that the inflection point roughly in 2020-2025, then, China's urban housing demand will no longer have a rapid increase in conditions.

Purchase whether full liberalization?

According to media statistics, since only in July, has been included in Jinan, Haikou, Hangzhou , Suzhou and other 10 cities relaxed the restriction policy. Whether the purchase of the property market will be fully liberalized?

"First-tier cities will not cancel the purchase." Ni Pengfei think that if Beijing, Shanghai and other cities to cancel the purchase of the policy, the influx of speculative demand will be immediately after the regulation effective on naught.

Previously, Beijing Mayor Wang Anshun in the first half of the economic situation analysis meeting, said Beijing would not loosen easily purchase and other measures, otherwise it will affect the sustainable development of cities.

Experts believe that in the case of bank credit policy has not changed significantly, the release bailout restriction policy had little effect. "But if there is change in the housing market and then passively release, you may be missing an opportunity, no need to bring to the market impact." Ni Pengfei that, for some real estate investments have fallen sharply, prices have fallen sharply, a significant increase in inventory areas, should By allowing local governments to take measures to release or discharge of the purchase, etc., to avoid unnecessary panic in the market and funding strand breaks.

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