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House prices in China have continued to trend upwards over December 2013, which is an encouraging sign for property investors and homeowners alike in the country.
New information released by the National Bureau of Statistics of China showed that sale prices for established dwellings in the country increased in 64 cities. At the same time, only five cities experienced a decrease and one remained the same.
Year-on-year price changes were strong over this period, after the National Bureau recorded rises of up to 19.7 per cent in some areas, with the biggest fall recorded at 7.2 per cent.
However, it wasn't just established residential real estate that reported high price growth over December 2013. It seems as though the newly constructed commercial residential buildings have continued to rise in price throughout the remainder of the year.
The National Bureau recorded 65 out of 70 medium and large sized cities experienced rises in sale prices, while only two saw declines. Year-on-year, this translated into substantial rises of over 20 per cent in some areas, with the largest decline at a small 2.8 per cent.
Major cities such as Beijing and Shanghai saw some very strong year-on-year growth for property overall after experiencing 16 per cent and 18.2 per cent respectively.
Growth still high, but slowing
Although year-on-year the residential real estate market in China has posted extremely strong results, price growth may in fact be beginning to cool down.
Month-by-month increases have begun to slow towards the end of the year. For instance, established dwellings rose by a small 0.8 per cent, while newly constructed homes increased by 1.1 per cent.
This could be due to a number of measures that local governments have enforced over recent months to improve affordability and battle rising house prices.
For example, the Shanghai government announced that buyers who wish to purchase a second home would need a minimum of 70 per cent for the deposit. This was raised by 10 per cent to help limit price rises in the city.
Furthermore, non-resident families in Shanghai will need to provide two years' worth of proof of tax or insurance records in order to purchase a first house in the city. Previously, non-resident families only needed one years' worth of proof, which shows the government's efforts to cool down price rises.
For more information about investing in residential real estate in China, get in touch with Ray White Group at www.raywhite.com.
