Land sales in 300 Chinese cities fell 49 percent from a year earlier to 147.5 billion yuan (US$23.9 billion) in July, a report said Wednesday, suggesting that property developers are adopting a cautious stance amid a weakening market.
First-tier cities like Beijing, Shanghai, Guangzhou and Shenzhen saw 70 percent year-on-year decline in land sales last month, the 21st Century Business Herald reported, citing data from China Index Academy.
The cooling property sector will directly eat into the fiscal revenue of local governments, which rely a lot on land sales income.
Amid concern over slowing sales, some local governments have already taken action to boost the property market. A total of 36 cities have relaxed property purchase restrictions as of now, with some even offering fiscal subsidies and preferential credit policies to prop up sales, the report noted.
With falling sales and tightened liquidity, property developers have taken a prudent approach in land bids. Beijing saw an auction of two residential-use land plots aborted on July 29, the first time such a thing in three years, according to the report.
Chen Guoqiang, deputy head of China Real Estate Society, was quoted as saying that the lagging effects of a weakening land market will continue, and the property market may not find it easy to recover in the short term.
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