In the January-April period this year, total real estate investments in China amounted to RMB 3.0928 trillion ($0.44 trillion), down 9.8 percent year on year, slightly faster than the decline of 9.5 percent in the first quarter, as announced by China's National Bureau of Statistics (NBS).
In the given period, new commercial real estate sold in China covered a total area of 292.52 million m2, down 20.2 percent year on year, also falling faster than the 19.4 percent drop in the January-March period.
The total area covered by construction activity in China in the given period declined by 10.8 percent year on year. The new area covered by construction activity decreased by 25.6 percent year on year in the given period.
The real estate development prosperity index in April this year stood at 92.02, down from 92.07 recorded in March.
However, this week the mood in the real estate market in China has improved. On May 17, vice president of the People's Bank of China (PBOC) Tao Ling said that the bank will provide low-cost loans to 21 local banking institutions for the purchase of completed but unsold commercial buildings at reasonable prices, supporting the affordable housing program. Though there have been no details on the volumes and timelines in question in the initiative, a number of market sources are assessing the development as a “game changer.”
Also, a separate measure, the PBOC is going to inject RMB 300 billion ($41.5 billion) to support affordable housing, including reductions in mortgage interest rates and downpayment requirements. “The housing policy keeps supporting the market sentiment and today steel futures reflect an optimistic rise and the daily debar trade is around 150,000 mt,” a Chinese trader said. “We are more optimistic now as this may fundamentally support the industry, but in the short term the [spot] market will remain range-bound,” another Chinese source said.
