Calls For Govt Intervention to Stop Home Price Increases in Shenzhen

This article argues against calls for government intervention in the housing market, this time to stop price increases in Shenzhen.

iFeng: 房价上涨有理! 要呵护楼市的脆弱信心
Rates do not want a return to rising prices in Shenzhen rose old administrative intervention in this round of real estate has become a sign of warming event. National Bureau of Statistics data show that in May in Shenzhen in a single month of new commodity prices rose 6.7 percent, second-hand home prices rose 6.3 percent gain leading the country. Some critics began to worry about "prices skyrocketing again", the Shenzhen Municipal Planning and Land Commission by the end of May has also introduced, including speeding up approval of sale of commodity housing, speed up new residential land supply, strengthen market supervision, thorough investigation "solar disk" and other policies to stabilize the market.

In this regard, "People's Daily" commented that house prices can only be left to the market to decide, to adjust unrealistic administrative intervention will inflame, distort supply and demand balance, so that prices more deformities.

Such judgments are fair.

The current portion of urban property market since late last year as a result of deregulation of administrative bondage. In the national real estate market is still high stock pressure top of the situation, the parties expect the transaction to pick up precisely to see the results, which we should cherish the hard-won situation. At the same time, we should rationally be seen in the first-tier cities of the property market at the same time, four-tier cities in the property market incentives "immunity", May 70 cities in new commercial housing prices were down 43 cities, flat city 7 , accounting for up to 70%. Even first-tier cities, Shenzhen is only a conspicuous exception, the other three cities prices are still in a stable state.

This shows that China's overall real estate market is not out of the downtrend channel, inventory is still a sword of Damocles hanging over the heads of the industry. Currently, some cities just to pick up the property, market confidence remained fragile, if this time the property market because housing prices in some cities began to take medicine, just to restore market would have been badly hit. For this price, at the bottom of the economy can bear? Local government debt situation can withstand severe?

Rates for individual growth of mega-cities, in fact, reasonable. Tier cities high prices of its economic vitality, population and income levels of aggregation normal reaction, which should objectively look. Shenzhen round of housing prices, the market also has its particularity, Shenzhen in recent years, economic innovation ability, rapid population growth, combined with land supply, housing prices is reasonable. At the same time we see that, with the Shenzhen adjacent to and known as the "Shenzhen East" in Huizhou, May was ranked the 70 cities housing prices decline in the first four, down 0.4%. What such a strong contrast description?

Description of the large numbers of people gather large city, to solve the problem of high prices, would like more space to approach. Shenzhen land supply to the limit, why not find a way to the periphery of Huizhou, Dongguan and other places? Why not fast rail transportation, public services and support through equalization, by breaking the household registration and administrative barriers to Shenzhen urbanization extended to four weeks, to ease the pressure by surrounding the property market in Shenzhen? Other large cities, too, will fall in Beijing, Tianjin and the joint development plan, it is also out of this consideration.

Seeing the current short-term rise in house prices, there are calls for the government to "manage"it and demand back the old administrative intervention in the market, not a good idea. The real estate market finally began to return to market-oriented path, we would not have to return to it. History has proven that going back is not good!

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