Real estate bounce in June

Keep in mind that housing is the main asset used by ordinary Chinese to hedge inflation risk.
Beijing home sales rebound in June

A property market rebound has been seen in Beijing as home sales in China's capital jumped to 25,602 units in June, 10.5 percent more than in May and 50.6 percent more than June 2011, new figures have indicated.
The trading volume of new homes in Beijing rose 14.1 percent month-on-month to more than 11,983 units in June, according to data released by the municipal commission of housing and urban-rural development on Sunday.
The average new housing price in Beijing in June was 20,678 yuan ($3271.8) per square meter, a 2.1 percent increase from the previous month, according to data from 5i5j Real Estate, a major housing agent in China.
Lower prices from developers and banks' reduction of interest rates prompted the rebound, according to Hu Jinghui, vice-president of 5i5j Real Estate.

The government's tightening policies have meant housing stock remains high. It is not necessary for home buyers to purchase in haste or make speculations, he added.

Real-Estate Prices Rise in China

According to a survey of property developers and real-estate firms, the average price of housing in 100 major Chinese cities rose in June from the previous month, after nine straight months of decline. The survey follows other signs that the Chinese market has bottomed out, including a pick up in real-estate investment in May and a far shallower decline in property sales during that month compared with April.

Assuming the economy isn't going to slow and do the job of lowering prices, will government restrictions work? The Chinese government looks smart because when an economy is growing strongly, it is relatively easy to redirect demand into other sectors of the economy. However, if things start going poorly, the wheels come off. A failure to stop rising home prices will be a signal that the real estate market cannot be stopped, that the government cannot control the economy and that homes remain a good inflation hedge. This could reignite the housing bubble.

Guangzhou Cars Sales Capped at 10,000 Per Month

The city of Guangzhou, a booming center of Chinese industry and economy, the capital of the administrative region of Guangdong, and China’s third largest city with 12.7-million inhabitants is imposing strict limits to the number of cars that can be purchased. According to autnews.gasgoo.com, local authorities will be limiting car purchases to 120,000 per year, which equates to just 10,000 per month.

Flashback to 2010: China's policy to encourage auto-buying shows effect

China's policy allowing car-buyers to enjoy both a purchasing tax cut and old-for-new trade-in subsidies, which took effect on Jan. 1, was generating good results with increasing applications and subsidy handouts, the Ministry of Commerce said Saturday.

Chinese government interference in the economy is starting to take its toll.