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Developers push up land prices by 46%

HONG KONG: China-based developers bid prices of land up by more than 46% week on week last week, brushing aside concerns that the central government is serious about cracking down on property price growth.

Data published by property website Soufun shows that developers paid an average 3,714 yuan (RM1,743) per square metre for 28 development sites sold during the week to October 17, up 46% from an average 2,538 yuan on deals concluded in the previous week.

But the data also shows that  developers are becoming more selective.

The 28 deals for the week compared to 67 deals in the previous week and 73 in the last week of September.

In Chengdu, nine sites were sold, offering a total gross floor area of 450,000 sqmetres at an average 3,256 yuan per square metre, while in Shanghai, two sites were sold for an average 8,825 yuan per square metre.

The higher land prices came despite tighter limits on new-home purchases announced this month by 11 major city governments.

City governments in Guangzhou, Shanghai, Beijing, Shenzhen, Hangzhou, Nanjing, Ningbo, Fuzhou, Tianjin and Xiamen have now rolled out similar restrictions on home ownership.

The move dampened buying sentiment in Guangzhou, with just 702 new homes being sold over the weekend, down 65% from 1,973 units a week earlier, according to the Guangzhou Municipal Bureau of Land and Resources.

Secondary- home prices in Guangzhou and Shanghai rose 3% month on month in September, according to data monitored by Centaline Property Agency.

Prices in Guangzhou were up 17.17% from a year ago.

Land prices in 105 cities rose 9% to an average of 2,805 yuan per square metre in the third quarter, Bloomberg quoted Xinhua as reporting, citing a report from the Ministry of Land and Resources. — South China Morning Post
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