China’s Commercial Property Prices to Rise up to 3.5 % in 2022, CIA Says
Xu Wei
DATE:  Dec 03 2021
/ SOURCE:  Yicai
China’s Commercial Property Prices to Rise up to 3.5 % in 2022, CIA Says China’s Commercial Property Prices to Rise up to 3.5 % in 2022, CIA Says

(Yicai Global) Dec. 3 -- China's commercial real estate prices may climb slightly next year with decreased sales area, according to an independent real estate research organization.

Prices could rise by 2 percent to 3.5 percent in 2022, supported by rising transactions in first- and second-tier cities, ChinaNews.Com reported yesterday, citing China Index Academy's latest report.

China has been trying to rein in property market overheating this year by issuing tighter lending rules amid China Evergande Group's liquidity crisis.

The land market structure may constantly be optimized in the future and the purchasing demand will concentrate in China's first- and second-tier cities that are more attractive to the population, said Huang Yu, vice president of the research institute.

Despite CIA's predicted improvements in the credit environment, buyers should not expect any great policy relaxation. President Xi Jinping's statement: "houses are built to be inhabited, not for speculation" is still true and fresh in policymakers' minds. But the country may implement a property tax pilot, which may affect buyers' sentiments in the short term, per the report.

Deals may be cooled in one factor. Sales area could drop in the range of 6.8 percent to 8.3 percent next year to around 1.6 billion square meters from the predicted figure of 2021, with expected continuous declines over the next few years, according to CIA.

That means that the post-Covid transaction surge is predicted to wear off. In the first 10 months of this year, the total sold area tallied 1.43 billion sqm, an increase of 7.3 percent from a year ago, according to data from the National Bureau of Statistics.

During China's 14th Five-Year Plan till 2025, the total sales area of commercial housing should range between 6.6 billion and 6.8 billion sqm, equaling from 1.3 billion to 1.4 billion sqm per year, said Huang.

Editor: Emmi Laine, Xiao Yi

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Keywords:   Properties,Price