BEIJING - It looks it will take a while before government policies to cool down the real estate market have their desired effect on property speculators.
According to the Chinese newspaper Economic Observer, the high-end property market in Beijing, which has some of the priciest real estate in China, still performed strongly despite the strong government intervention in the sector since mid-April.
The newspaper reported that buyers of expensive properties consist mainly of proprietors of private energy companies, as well as senior executives of financial services and real estate companies.
"The three groups account for 70 percent of our clients," said Wei Wei, vice-president of E-House (China) Ltd in Beijing.
Starting from April 17, the government has introduced a series of strict measures designed to curb soaring housing prices, including tighter mortgage requirements and a limit on individual buyers' multiple purchases and ownership. It is rumored that a property ownership tax will soon be introduced.
For example, from April 15 to 19, at an apartment complex near Chaoyang Park with an average price of 44,000 yuan ($6,445) per square meter, 10 units were sold with unit price ranging from 5 million to 12 million yuan, according to data from Yahao realty company.
Some expensive apartments in the development required payment in full. Most of the 200 new apartments put on sale at the development in January were reportedly sold out within three months.
According to World Union, a real estate service and consultancy company, 35 to 40 percent of the new homes costing at least 25,000 yuan per sq m required payment in full. In contrast, up to 80 percent of the homes costing up to 16,000 yuan per sq m were bought with loans.
The tightening of transaction regulations seems to have had a greater impact on ordinary purchasers, said Chen Jinsong, chairman of World Union.
"For purchasers of high-end property, their priority is to retain the asset value rather than quick investment returns," said Li Liqun, sales director of Runze Villas in Beijing.
At the same time, of the passionate property speculators, many still do not think they are the ones who are to blame for the city's skyrocketing housing prices. Mine owner Wang Jinhuan disagreed that colliery bosses from Shanxi province are among main purchasers of high-end homes.
"It is easy to understand why people think this way. But we don't have such power. As far as I know, Shanxi coal mine owners only account for a small number and cannot influence the whole market," Wang said.
Wang bought his first property in Beijing in 2004, he now owns more than 40 homes in the city, Economic Observer reported.