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China's property prices up 24% in 2009

(chinadaily.com.cn)
Updated: 2010-01-20 15:23

China's real estate sector set several new records in 2009. Nearly 940 million sq m of properties sold, and the average price hit 4,695 yuan ($687) per sq m, China's National Bureau of Statistics (NBS) revealed Tuesday.

Official data show that the overall real estate sales volume hit 937.13 million sq m, up 42.1 percent from the previous year. The sales volume of residential properties was up 43.9 percent, the office building sales volume was up 30.8 percent and the sales volume of commercial properties such as shops was up 24.2 percent.

"The sales volume in 2009 is quite amazing. It is much larger than 620 million sq m in 2008. It even beat the previous record of 760 million sq m in 2007," said Yang Hongxu, a Shanghai-based researcher with E-house China R&D Institute.

Yang said that, based on numbers released by the NBS in January, the increase in sales volume should be 51.6 percent – not 42.1 percent. It was unclear how the NBS determined its latest calculation.

Sales revenues hit 4.3995 trillion yuan in 2009, a 75.5 percent increase from the previous year. Revenues of residential properties soared by 80 percent, and increased 66.9 percent for office buildings and 45.5 percent for commercial properties.

The national average of property prices stood at 4,695 yuan per sq m, up 24 percent, or 813 yuan per sq m. This is the largest increase in nearly 15 years, according to Yang. "The price increase was 18 percent in 2004, about 15 percent in 2007, about 14 percent in 2005 and less than 10 percent in other years," he said.

Investments in real estate reached 3.6232 trillion yuan in 2009, a year-on-year increase of 16.1 percent.

China's real estate prices are unlikely to fall in the near future, since developers have enough cash flow due to the positive news about investments and sales, according to industry insiders.