Guangdong Housing Society: Price, Accountability, Recapitalization, Sales Limit or More

The State Council announced the dispatch of an inspection team to conduct special supervision of the implementation of the State Council's real estate market control policies and measures in 16 provinces (cities) from late July. As one of the provinces inspected, the Guangdong Housing Society has also stated in the latest market report that the market's warming has reduced the company's preferential margins and even increased its price. Administrative measures such as price control and accountability may be reproduced, and sales at limit prices may be limited. Or will be more severe.

According to the statistics of Centaline Group Research Center, the accumulated number of new houses sold in 54 large and medium-sized cities nationwide increased by 16% from the same period in June, 19 days before July. Among them, the recovery rate of the third-tier cities is about 25%. Although the price increase rate of most new construction projects has only fluctuated within the range of 5% to 10%, the number of price increase projects has increased rapidly.

On the other hand, with the continuous recovery of trading volume, the land market has also become increasingly active. Since the king of Wanliudi in Haidian District was released, several residential lands that have been continuously supplied by the Beijing land market have experienced high premium transactions under the conditions of “limited land price, competitive bidding and construction”. The second half of the property market regulation and control task remains arduous.

Guangdong: East and West wing prices down

“The central dispatching inspection team is a 'soft' measure, but at present it may be more effective than the 'hard' measure.” Han Shitong, a member of the Guangzhou City Housing Society’s expert committee, believes that the purpose of the central government is still to curb investment speculative demand. The supervision may be linked to the accountability of the property market regulation, and some cities that have loosened the policy of restricting the purchase of loans may be “stopped”.

According to the data released by the Housing Society of Guangdong Province in the first half of the year, Guangdong's regional property prices did not show a significant rebound in the first half of the year.

In terms of sub-regions, the sales volume in the second quarter of all regions has increased from the first quarter. Among them, the sales growth rate of commercial housing in the Pearl River Delta and West Wing districts was 55.5% and 68.0%, respectively. The growth rate in the east wing and mountains was 22.4% and 13.6%, respectively. In terms of average selling price, the Pearl River Delta increased by 6.9%, with east and west wings dropping by 3.4% and 5.3%, respectively, while mountainous areas remained flat.

In addition, in the first half of this year, the year-on-year growth rate of Guangdong's real estate development investment completed showed a rapid downward trend month by month, especially in the second quarter, its year-on-year growth rate was only 1.5%. The Housing Society of Guangdong Province stated that the trend of growth in real estate investment lags behind the growth of commercial housing sales by 2 to 3 quarters. Judging from this, if the sales volume in the second half of the year will continue to rise with relatively stable prices and the policy environment will not undergo major changes, investment growth is expected to stabilize in the next one to two quarters.

The Provincial Housing Society disclosed that Guangdong's newly-started commercial housing area in 2010 has increased by 58% year-on-year, and its year-on-year growth rate has reached 21% in 2011. It is assumed that the new construction area will form a commercial housing market supply two years later, and then the sales of commercial housing in this and next two years will be assumed. With an increase of 20% in area, the supply is sufficient to meet market demand.

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