Chinese housing market 'in trouble'

12 September 2008

Despite strong economic growth topping ten per cent, the Chinese housing market is beginning to cool off.

According to the Asian nation's National Bureau of Statistics, annual growth in property prices has declined from double digits in late 2007 to just seven per cent today.

This tapering-off is in line with recent falls on China's stock markets and in its export growth, the New York Times reports.

Real estate brokers who spoke to the newspaper also confirmed that the housing downturn originated in the south east of China, before spreading to the rest of the nation.

Hwang Sha, a broker in the eastern city of Xiamen, commented: "People are thinking more carefully and taking much longer before they decide to buy or not to buy property."

Freddy Wu, chief executive of real estate agency Hong Kong Property Services, added that defaults among his clients were on the rise.

"A lot of investors from China have their cash tied up in the mainland stock market and in mainland real estate, so they would rather take a loss now," he explained.

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