Pan Shiyi

The mainland’s ailing property sector is expected to recover this year as new government measures take effect. An example of these measures is that the Beijing municipal government has purchased about 1,000 commercial housing units to provide more ‘welfare homes’ to improve living quality.

The Beijing Times quoted Niu Qingshan, head of Chongwen district, as saying: ‘We will help people improve housing problems by different means.’

He said the apartments bought by the municipal government were at least 15% cheaper than other flats in the same district.

The State Council has set a target of 1.3 million homes for low-income families in three years while bolstering the real estate market.

SOHO China chairman Pan Shiyi said the real estate market in the mainland has touched bottom, but it is hard to predict how long the ‘mess’ will last.
Source: The Standard

         Xu Shaoshi

China’s Ministry of Land and Resources (MLR) has issued a circular with 10 other authorities to encourage an increase in land use planning and management. This is in step with the government’s  measures to stimulate domestic demand.

The circular said that local authorities should protect the arable land and farmers’ legitimate interests in handling land use applications for new projects.

Xu Shaoshi, head of the MLR, said the economic crisis has added difficulty to the country’s land management work, as the central and local governments’ investment programs have demand for more land.

He also said the MLR shouldered a mounting responsibility of combating malpractice in land use.

Chinese government announced a RMB4 trillion ($584 billion) economic stimulus package last month to push forward economic growth and domestic demand.

The fund is to be spent over the next two years to finance programs in 10 major areas, such as low-income housing, rural infrastructure, water, electricity, transport, the environment and technological innovation.
Source: China.com

Near the limit

Qin Hong, deputy research head at the Ministry of Housing and Urban-Rural Development said in an interview with the China Securities Journal that China is unlikely to cut property transaction taxes much further and will continue to curb housing purchases for the purpose of investment.

The government has shortened the lock-up period during which home owners are subject to a business tax if they resell their homes and said it would levy the tax on capital gains instead of the overall value of the sold property.

The changes were part of measures to support the ailing real estate market, a pillar of China’s economy which has been slowing from the impact of the global financial crisis.

Qin Hong said, ‘China has reduced the transaction taxes and fees significantly and there is now limited room for further cuts.’

Beijing has also repeatedly pledged to provide more affordable homes to accommodate its low-income population and plans to spend RMB900 billion($132 billion) in the next three years to build such homes.
Source: Forbes

Greentown China Holdings

Greentown China Holdings is one of ten Chinese property firms that will spend about $519.5 million to effectively buy a controlling stake in Japanese real estate fund Pacific Holdings. This according to the Nikkei business daily.

The debt-ridden Japanese company said last month it would raise that amount by issuing common and preferred shares by February to several Chinese real estate firms, but it did not disclose any company names.

A Pacific spokesman could not immediately confirm the report.

The Nikkei reported that Greentown and nine unlisted Chinese companies will indirectly purchase Pacific’s preferred shares, which would account for 90% of voting rights if converted into common stock.

Greentown will purchase 15% of the preferred shares and another firm will buy 20%. The report said the other companies will split the remaining shares nearly equally.
Source: Reuters

Chinese property to rise

The Chinese government has launched a series of tax and fee cuts to boost the real estate sector. But what do real estate developers think about the new package?

Chen Shun, president of China Sports Organization Group,  a real estate development company, is in charge of more than 30 projects.

He said business has fallen in the past six months, and some projects have even been postponed. Chen said the new policy should stabilize market confidence in the future.

Chen Sun said, ‘It’s clearly stated by the government that the emphasis now is to stabilize market confidence in real estate, while the key is to boost the development of the sector.’

Another real estate developer says the new measures show government’s expectations for the real estate market.

Zhou Bin, vice president of Beijing Fengtongxiangrui Real Estate, said, ‘With this is a soft policy rather than a compulsive one, the government is encouraging real estate developers. The government hopes developers will face the market with more optimism, to find different ways to get past the downturn. It also shows the government’s wish to develop a sound real estate market.’

According to the National Bureau of Statistics, from January to November this year, sales of residential properties in terms of the floor area, dropped 18% from the same period of last year. The figure plunged 45% in Beijing, 40% in Shanghai and 26% in Guangdong province.
Source: CCTV