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Guangzhou property prices hit new high in June

By Zheng Caixiong (China Daily)
Updated: 2007-07-06 14:07

House prices grew more than 1,000 yuan per square meter in Guangzhou last month, hitting a record high of an average of 11,331 yuan.

It is the biggest jump for property prices in a single month in this provincial capital.

The highest price for luxury apartments in the city's prime locations has even crossed 20,000 yuan a square meter, catching up with those in Shanghai and Beijing. A new three-bedroom apartment in the city proper now comes at over 1 million yuan.

Real estate analysts forecast the city's property prices will maintain strong growth momentum in the second half.

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Huang Tao, a senior property consultant from Guangdong Centraline Property Co Ltd, estimates prices of commercial apartments will grow at least 20 percent.

Property prices in Tianhe and Haizhu districts, traditionally Guangzhou's business hub, are expected to grow even faster. By the end of June, property prices in Tianhe had grown to an average of 13,721 yuan a square meter.

Huang attributed the growth of property prices to the imbalance between supply and demand in the southern metropolis. "There are few low-price small apartments in city proper. Prices have thus been pushed up by the large number of luxury apartments."

A total of 696,500 square meters of new commercial apartment space changed hands in June. Many who have profited from the bull run in stocks might have begun shifting their investment to the property market, Huang added.

Property price rises have scared away many local first-time buyers. Most property buyers in these past months were buying their second apartment or changing into a bigger one.

To help cool the real estate market, Zhang Guangning, mayor of Guangzhou, promised to introduce new measures in the second half. The city government will offer even more land for property development and build more budget houses for low-income families.