Focus

Housing agents worried by success of market policy

By Huang Yuli (China Daily)
Updated: 2010-06-23 07:58

A sales agent promotes second-hand apartments in the capital. ZOU HONG / CHINA DAILY

Beijing's real estate agents are far from happy following the release of a regulatory policy in April that has knocked purchasing prices down by around 15 percent.

Chang Yongfeng, an agent with the Anhuiqiao division of Homelink Real Estate, a Beijing-based chain, told METRO the number of clients viewing apartments has risen during the last week but few are buying.

Chang said because speculators are being cut out of the market, due to strict restrictions on households purchasing more than one apartment in Beijing, his remaining customers are genuine first-time buyers.

While it might prove the policy successful, Chang said the group is extremely hesitant and has learned to wait for lower prices.

On April 30, a regulation was released by Beijing Municipal Commission of Housing and Urban-Rural Development to slash housing prices.

It included ending the right to obtain a mortgage when buying a third home, or if the person had not paid taxes in Beijing for more than one year.

Chang deals exclusively with second-hand apartments. He said prior to April, he could bring in profits between 20,000 and 100,000 yuan for Homelink a month. So far in June, he has not managed to sell a single property.

Qiao Douyue, an agent with Ehomepark, confirmed the price reduction.

"A 60-sq-m flat with one or two bedrooms, normally priced at about 1.4 million yuan, is now 200,000 yuan cheaper," he said.

He added that the owner of a 1.65 million yuan two-bedroom apartment had lowered their asking price to 1.5 million yuan.

Qiao said his company sees only a handful of people come in for viewings each week and not a single deal was struck in April and May.

He said business had improved slightly from the beginning of June, mostly from those looking to buy a first apartment or to downgrade to a smaller one.

"But no deal has been closed yet," Qiao said.

On the other end of the market, rental charges have climbed by more than 20 percent in June, with the average lease of a two-bedroom apartment hitting 3,000 yuan.

Qiao explained that many apartment owners are hesitant about selling in a stagnant market and instead looking to earn in the short term.

"Many are renting out their apartments but still hope to sell when the price is right," he said.

Cao Yibo, an agent with Runwanjia Real Estate, works in sales and rentals.

He said that the total turnovers of second-hand apartments in Beijing in May was fewer than 3,000 units, a significant drop from the 30,000 sold in March.

"This month, the number has exceeded 4,000 but it is still far from satisfactory," Cao added.

"We made more than 1 million yuan through sales in March, but none in April and May.

"So far, in June, we have sold only three places."