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Real estate investment in China rose at the quickest clip in two years and growth in floor space sold sped up in the first two months of 2017, even as growth in total sales value decelerated.
Investment in real estate development for the January-February period rose 8.9 per cent compared to a year earlier, according to data from the National Bureau of Statistics. That’s a jump of 2 percentage points from December’s level and the highest growth reading since the same period in 2015.
That suggests domestic investors are once again eager to pump funds into property markets. The move tracks with the latest reading from the FTCR China Real Estate Index, which surged in February as the market bounced back from the lunar new year holiday and despite Beijing’s efforts to clamp down on speculative activity.
Sales growth for new housing in the first two months of 2017 came to 140.5m square meters, a year-on-year rise of 25.1 per cent and up 2.6 percentage points from the pace seen in the 12 months ended December.
In value terms, however, sales totalled just over Rmb1.08tn ($156.2bn), reflecting growth of 26 per cent for the period and an 8.8 percentage-point deceleration from the 12-months ended December.
Both growth rates were down substantially compared to the same period in 2016, with value slower by 17.6 percentage points. That suggests price averages from 70 major cities, due out later this month, are likely to come in on the softer side.
But with growth in sales volume slowing only 2.1 percentage points lower over that period, investors may view the present moment as a chance to scoop up property on the (relative) cheap.