Property sales hit record, but may ebb on curbs

China's housing market sales in terms of both floorage and revenue hit record highs in the first quarter on lower base of last year, but may recede in subsequent months as regulators curb speculation, industry experts said on Friday.

The National Bureau of Statistics said up to 360 million square meters of floor area in the commercial property sector was sold in the first quarter, up nearly 64 percent year-on-year and up nearly 21 percent over the corresponding (pre-pandemic) period of 2019.

In value terms, first-quarter commercial property sales generated 3.8 trillion yuan ($582 billion), up 88.5 percent year-on-year.

Among the 70 major Chinese cities tracked by the NBS, 62 saw monthly housing price increases in March, higher than the 56 cities that reported higher property prices in February.

Based on the monthly figures, Guangzhou and Fuzhou saw the most significant growth of 1 percent in March, while the monthly rise in Beijing, Shanghai and Shenzhen stood at 0.2 percent, 0.3 percent and 0.1 percent, respectively.

Experts compiling China Real Estate Index System explained that property developers have adjusted their management strategy in a timely manner in the first quarter by emphasizing more on marketing of certain projects. Homebuyers' demand has thus been released in a positive way.

Looking into the following months of the year, cities where the housing market is already showing signs of overheating are likely to see more stringent government policies. The market demand will be addressed in a more reasonable and steady way, said CREIS experts.

On the other hand, central regulators have been cracking down on business loans or consumption loans misused in the property market. The regulation on residential loans will be further tightened. As the influence of last year's low base data mitigates in the next few months, the growth rate of China's commercial housing is likely to slow down.

Meanwhile, investments by property developers surged 25.6 percent year-on-year to 2.8 trillion yuan in the first quarter, among which the majority 2.1 trillion yuan was for developing residential projects.

Property projects covering up to 360 million sq m started construction in the first quarter, up 28.2 percent year-on-year. The newly started residential projects accounted for the majority 270 million sq m, up 30.1 percent from a year earlier.

According to NBS spokeswoman Liu Aihua, major gauges such as investment and sales revenue have seen double-digit growth in the first quarter, which can largely be attributed to the low base data collected during the same period last year. Regulators and municipal governments across the country have been closely watching the ups and downs in the property market and have come up with effective measures to stabilize land and property prices and market expectations.

As continued efforts to build low-rent housing and a long-term rental market intensify, both rental and sales will gain rational weighting, which is conducive to the steady and sound development of the Chinese property market, according to the NBS.