Property prices in Chinese cities are falling, and small and medium-sized developers are feeling the credit crunch, according to China Daily:
One after another, major Chinese cities are reporting sluggish sales in their real estate markets, due primarily to the central bank’s continual interest rate hikes and the following credit crunch.
For Zhang Qiang, a sales executive of Beijing Haolong Real Estate Company, the early weeks of 2008 have been especially cold – not because of the snow storm that hit the southern provinces, but the company’s worrisome sales records.
It is the worst time in two years. “Before the spring festival, we barely managed to sell five apartments for one-time payments, at a pretty nice price for buyers,” he says, “With that payment, we just got enough, 3 million yuan, to pay the salaries to our staff before the holiday season.”
China Daily also reports that brokerage firms are also feeling the cold winer:
It has been a very cold winter for China’s top real estate agencies, with several of the largest firms closing outlets in the face of plummeting transactions and slipping prices.
Shenzhen-based Chuanghui, before the country’s largest real estate brokerage, closed more than 200 outlets in Shanghai in January. The company, with over 1,800 offices across the country, is also closing outlets in other cities.
At the same time leading real estate firms based in Beijing, such as Golden Keys and Xinyitian, were also reported to have significantly reduced their number of outlets to save cost.