China’s residential real estate market seem to be working as property prices increased at their slowest pace for 11 months in 2011 July after the government expanded efforts to curb the risk of an asset bubble.
According to China’s biggest real state website owner SouFun Holdings, prices rose 0.2% in 2011 July from June, the slowest since 2010 August.
Residential prices increased in 66% cities tracked by with average home values nationwide climbing to 8,874 yuan ($1,378) a square meter.
China’s cabinet said last month it will expand measures to rein in residential prices to smaller cities after limiting home purchases in metropolitan areas including Beijing and Shanghai. The Chinese government is intensifying real estate restrictions nationwide after developers posted gains in first half sales and housing transactions climbed 31% in June, even as down payments on some mortgages were increased this year.
China’s property market is cooling down gradually, but it’s still not obvious. This is a matter of time. With high inflation and investment, it’s unlikely home prices will drop soon.
In China home prices in 2011 July raised 6.8%t from a year ago.
According to the national statistics bureau, China’s consumer price index hit a 3 year high in June while investment in real estate rose 33% to 2.6 trillion yuan in the first six months from a year earlier,
Some experts think the bubble will burst.
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