House prices up 7.1 pct in major Chinese cities

Updated: 2007-07-24 01:04

BEIJING -- The housing prices in 70 large and medium-sized cities in China continued to rise in June, up 7.1 percent over the same period last year.

Last month, the prices of newly-built commercial housing units were up 7.4 percent year-on-year, according to figures released Monday by the National Development and Reform Commission in cooperation with the National Bureau of Statistics (NBS).

The cities include Beijing, Shanghai, Tianjin, Shenzhen and Guangzhou.

The prices of low-cost housing rose 1.4 percent and the prices of expensive housing went up 8.5 percent. The cities of Beihai, Shenzhen, Nanjing, Beijing and Shijiazhuang reported higher-than-average price hikes, the commission said. The housing prices in Beihai went up 15.5 percent and the prices in Shenzhen were up 13.9 percent.

Prices of second-hand houses in those cities were up 7.8 percent last month over the same period last year and one percent higher than the previous month.

Rising house prices have been a major bugbear of the Chinese people in recent years as new houses are too expensive for most urban residents. Speculation by domestic and overseas investors has been blamed as one of the reasons for the price hikes.

The government has been keen to tame the wild property market as it has sparked grave public concern over housing security and is fueling the fast expansion of investment and bank lending.

China's real estate investment soared 28.5 percent from a year earlier to 988.7 billion yuan (130.6 billion U.S. dollars) in the first half of 2007, according to the NBS.

The growth was 1.6 percentage points higher than the first quarter and 4.3 percentage points higher than the same period last year, said the NBS.

Analysts attributed the rising investment to booming housing demand, excessive liquidity and robust housing price hikes.

Amid investment by real estate developers, domestic bank loans rose by 25.9 percent year-on-year, enterprises' self-raised funds increased by 28.4 percent and foreign funds soared 68.7 percent.

The NBS announced last week that the real estate climate indices reached 103.63 points, 0.31 points higher than May and 0.7 points higher than the same period last year.

The total area of "developed" land in China rose 7.6 percent to 118 million square meters in the first half.

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