Throughout November, both property prices and transactions have maintained a downward slide in the Chinese cities of Beijing, Shanghai, Guangzhou, Shanghai, and Shenzhen. Meanwhile, real estate developers have purchased less land, purchasing just 60 percent of the October total.
Vanke, one of China’s biggest real estate developers, made just two property purchases at a cost of 2.449 billion yuan, just a quarter of the value of the firm’s purchases in October.
Country Garden, another major Chinese real estate developer, bought one parcel of property at a cost of 4.4 million yuan in November. By comparison, Country Garden spent 41 billion yuan in its busiest month this year.
The Guangzhou Real Estate Agents Association recorded that transactions for previously owned houses in the same period reached 377,900 square meters, 51.43 percent less than November 2017, and a record low in the past 33 months.
Data from Ankeju Data Analysis showed that the Shanghai real estate market also softened in November, with activity down about 14 percent from the year-earlier month.
Shenzhen is a major city in southern China’s Guangdong Province that neighbors Hong Kong. Shenzhen is the 22nd-most competitive financial center in the world, according to the 2017 Global Financial Centers Index, and is a China high-tech city.
In the past six months, the number of houses in foreclosure increased 50 percent, according to Guangan Juye, a Shenzhen Foreclosures Company. There were 2,800 houses in foreclosure by November, 33 percent higher than last year. Furthermore, people bought homes originally valued at 7.5 million yuan for just 4.9 million yuan.
As reported by the official website of the Shenzhen Intermediate Court, there were 26 houses in foreclosure in October, but only 15 of them had been sold. At auction, normally there were only two people quoted. The best case had five bidders, and in the worst case, no price was offered.
The “bitter winter” of the real estate sector is now a popular topic in Chinese public discourse.
While many Chinese economists think Chinese authorities will change policy to increase property prices because China’s market is state-controlled, state media have so far not indicated that will happen.