China Enjoys Record-Setting $1 Trillion in New Home Sales in 2013

China Enjoys Record-Setting $1 Trillion in New Home Sales in 2013

Residential News » Asia Pacific Residential News Edition | By Francys Vallecillo | January 20, 2014 9:03 AM ET

China's new home sales for 2013 surpassed $1 trillion for the first time, as the country enjoyed higher homebuyer demand and relaxed national property curbs. 

In 2013 the total value of new homes sold was 6.8 trillion yuan ($1.1 trillion), increasing 27 percent from 2012, according to the National Bureau of Statistics. In 2012 the value of new home sales was 5.4 trillion yuan, after an 11 percent increase from the previous year, the government data shows. 

New home prices in Guangzhou and Shenzhen increased 20 percent in December, compared to the previous year. Prices increased 18 percent in Shanghai and 16 percent in Beijing, according to the data. 

"Clearly, the real estate market in China remains hot," Dariusz Kowalczyk, a senior economist and strategist at Credit Agricole CIB, told Bloomberg. "Urbanization and investment demand are leading to rising sales volumes, while prices continue to gain. China's growth remains heavily dependent on the real estate market." 

Following the previous administration's campaign to cool the property market, Premier Li Keqiang has shied away from additional property curbs, instead leaving it up to individual cities.  

The governments of Shanghai, Shenzhen and Guangzhou, the country's most expensive housing cities, have all introduced measures, increased down payments for second homes to 70 percent.  

"The effect of those measures was limited last year because in first-tier cities demand still outpaced supply," Ding Shuang, a Hong Kong-based senior China economist with Citigroup Inc., told Bloomberg.  

Private housing figures also highlight the country's hot property market. Home prices posted a 12 percent yearly increase in December, the highest in 2013, according to SouFun Holdings Ltd., China's biggest real estate website owner.

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