Property prices in China to remain stable

This article is more than 12 months old

China's housing minister has said Beijing will not waver in its efforts to regulate the property market and has no intention of loosening control measures, in a sign that the recently-frothy housing market is still being closely watched.

Property sales will slow in the fourth quarter while prices remain stable, Minister of Housing and Urban-Rural Development Wang Menghui said yesterday, reiterating President Xi Jinping's pet phrase that "housing is for living in, not for speculation".

Mr Wang noted that prices of new homes have fallen for 11 consecutive months in first-tier cities and for nine consecutive months in second-tier cities, as more signs emerge that the country's two-year housing boom may have peaked.

He was speaking on a panel also comprising the health, education, manpower and civil affairs ministers on the sidelines of the Chinese Communist Party's 19th national congress, which ends tomorrow.

Real estate is a key driver of China's economy that directly affects 40 other business sectors, and surging prices have raised concerns about a potential asset bubble.

China has imposed tailored curbs in more than 45 major cities since last year to rein in prices without triggering a crash that could undermine economic growth.

Yesterday, Mr Wang admitted that there were still "problems and difficulties" in the housing market, and affordability remains a closely-watched issue for many Chinese people.

But there are bright spots: Besides stabilising prices, China has also expanded its public rental scheme, which today houses 190 million poor residents.

Pilot projects have been launched in 12 major cities to build even more rental homes, he added.

Beijing and Shanghai are also exploring common property rights housing that will see buyers and government share rights in the unit in exchange for lower prices.

The panel of ministers also brought into focus the longer-term challenges that stand in the way of President Xi's China Dream of becoming a moderately prosperous country by 2020, and a major power by 2050.

Mr Xi, in his work report on Wednesday, acknowledged that the principal challenge China faces in its next phase of development is "the contradiction between unbalanced and inadequate development and the people's ever growing needs for a better life".

One aspect to this is job creation.

Though China's 3.95 per cent unemployment rate last month was the lowest in years, Ministry for Human Resources and Social Security Yin Weimin said difficulties remain.

A key question is how to continue creating high-quality jobs for the 15 million young people, including eight million fresh graduates, who join the workforce every year.