Economy

More buyers delay home purchases: Poll

By Cheng Yingqi (China Daily)
Updated: 2010-04-06 07:11

BEIJING: Recent government measures to cool the real estate market have chilled Beijingers' desires to buy an apartment, a new survey suggests.

Residents in the Dujiang Xiyuan development said they were not informed of the plan to sell their land. [Agencies]

About 42 percent of buyers have suspended their purchase plans this year, according to a survey released over the weekend by the People's Bank of China, China's central bank.

The survey, which polled more than 1,110 residents in Beijing from January to March, shows over 14 percent of respondents expect housing prices in the capital to drop in the next three months, up more than 8 percentage points from a similar survey conducted from October to December last year.

Another 13 percent expect the price to drop within a year, the latest survey shows.

Among respondents who plan to buy apartments in Beijing, about 42 percent have decided to postpone their purchase plans because they expect the price to drop, the survey shows.

However, the survey does not necessarily show the demand for housing in Beijing is decreasing, as people from across the country are buying apartments in the capital, says Tan Jun, an associate professor with Beijing-based Renmin University of China.

"Housing resources in Beijing are limited while demand comes from all across the country," he said.

Since the beginning of this year, the central government has put forward a series of policies to curb soaring housing prices, including raising the interest rate of real estate loans to developers and constructing more welfare housing.

In the survey, 39 percent of purchasers felt welfare housing projects were the best solution. Also, 25 percent were in favor of increasing interest rates for housing loans and more than 19 percent applauded a possible property tax.

However, despite expectations of a price drop, investors still have confidence in housing projects in Beijing.

Among respondents who plan to buy apartments, more than 23 percent are in it for the investment, the highest figure in two years, the survey shows.

Tan said a householder may have several houses registered in the names of different family members, so it is difficult to tell speculators from normal house buyers.

In the survey, 14 percent of the respondents say they have more than one property. The number of multiple-house owners is up by 1 percentage point over the same period last year.

"Although I have two houses, I don't think I'm speculating," said Liu Qiu, a 55-year-old Beijinger.

Liu said she bought one house for her 24-year-old son who will marry in a few years.

"I don't want to live with my son and daughter-in-law, so I have to buy them a house. And my friends at my age do that too," Liu said. "After buying a house for my son, I'm not planning on buying any more houses. So I think it's a real need instead of an investment."

The survey also shows secondhand houses becoming more popular. Among purchasers, almost 20 percent choose secondhand houses, the highest level in the past four quarters.