HONG KONG (Nov 17): China's home price restrictions will remain in place well into next year , a top executive at one of Hong Kong's biggest property developers predicted on Thursday, despite suggestions that Beijing might ease policy.

"The cooling measures will stay until they change the government," Justin Chiu, executive director at Cheung Kong (Holdings), said at the MIPIM Asia real-estate conference.

Premier Wen Jiabao, who is due to retire from his Party post in late 2012 and step down as premier in early 2013, has said he wants to see runaway prices return to "a reasonable level".

While the curbs will lead to a stagnant residential housing market, Chiu remains bullish on China and said Cheung Kong — which has money invested in ports, retail and property in China — is actively looking for acquisitions.

Although by some measures property prices have fallen for two months, leading some analysts to predict developers will cut values by as much as 30%, Chiu does not expect a market crash.

"Because of the cooling measures, the transactions will drop, but prices may stand still," Chiu said.

Analysts predict a tough year ahead for Chinese property.

Stephanie Lau, China property analyst at Mirae Asset, expects developers to cut prices 20% to 25% across the board, with some going as far as 30%.

But Chiu indicated he did not think price cuts were necessary. He also predicted that prices in the slowing Hong Kong property market would stay firm and would not suffer from the impact of the eurozone crisis, which he said he was confident would be resolved favourably.

Chiu said he was very bullish on mainland cities such as Nanjing, which he expects to become China's most important city after Beijing and Shanghai.

"I wouldn't be surprised if in five years, Nanjing's GDP had doubled," he said.

As well as a looking for acquisitions, Cheung Kong is negotiating with local governments on development opportunities, he said.

"It is difficult to get money into China, but if you have money there, it's a great time to go out and shop," he said. — Reuters

SHARE
SPONSORED CONTENT
Damayan Residences—new freehold sanctuary in Subang Jaya, where urban energy meets nature’s calm

With just 308 units within a single block, this development gives you a level of privacy and exclusivity rare in today’s urban market, with a walking-distance LRT station to boot.

read more