The report on the latest prices for home sales in China has been released and it looks good for the world’s third economy. Official data on Tuesday showed monthly home prices climbing for a third straight month in July.
The housing market has been in a slump for the last 16 months and is only now re-emerging as a result of the removal of certain restrictions on mortgage lending and the falling interest rate. Overall new home prices rose 0.3 percent on month in July, versus a 0.4 percent gain in June and May's 0.2 percent rise. On an annual basis, July prices fell 3.7 percent, compared to the previous month's 4.9 percent slide, an indication that the sector is hovering towards a recovery.
Prices Should Continue to Go Up
According to Mizuho Securities Asia Ltd., a Hong Kong-based real estate company, prices should continue to rise this year as liquidity remains ample and people are moving ahead with real estate purchases that they have held back doing until now.
Alan Jin, an analyst at Mizuho said that “the average price gains may accelerate in the second half as prices in the second- and third-tier cities are just starting to rise. The demand is still there.”
Jin was referring to China’s two-speed real-estate market, where home demand in first-tier cities like Beijing, Shanghai and Shenzhen is recovering, while an over-stock of properties still plagues the lower-tier cities.
As things are going, however, the nationwide market is coming to life once again and it is a good time for investors to jump in.