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CICC: China's property boom won't last

Xinhua | Updated: 2013-03-26 10:11

SHANGHAI -- China's real estate investment will lull later this year after surging in the first two months, the China International Capital Corporation (CICC) said Monday.

CICC said growth in housing sales will decrease due to tightened monetary policies and a harsh policy package aimed at curbing property prices.

China's housing market started heating in the last quarter of 2012 after a long slump.

In January and February, the total sales area for commercial housing jumped 49.5 percent year on year, 47.7 percentage points higher than last year's growth, data from the National Statistics Bureau showed. Real estate investment increased 22.8 percent year on year.

However, the CICC said new monetary policies will not fuel the sales boom. Credit growth is set to fall, as the government has lowered its monetary supply growth target.

"Regulators will also tighten shadow banking, restricting the financing conditions for real estate," CICC said.

The central government issued a strict policy package last month to contain housing prices, with a 20-percent tax on capital gains from property sales.

The CICC predicted that sales will be dampened in the second and third quarters of 2013.

"Real estate investment will not grow notably faster than last year," the CICC said.

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