Top Chinese real estate developers all achieved strong sales in the first quarter of 2017. And with mixed market expectations, property developers had acquired much more land parcels than the Q1 period in last year.
Nothing could reflect a market more fully than its players’ performance. In the first quarter, top developers Country Garden, Vanke, and Evergrande all registered high sales exceeding a hundred billion yuan, with 13 brand real estate development companies gaining 24 percent of annual sales target, reported Caixin. Meanwhile, the total amount of investment into acquiring land also surged compared with the previous year.
Country Garden, the dominant player in smaller cities, tops the list with 150.66 billion yuan in sales, with a surge of 251 percent year-on-year. The good performance is believed to be linked to the booming market in lower tier cities during the period.
According to Caixin think tank CEBM, major real estate developers would continue to be bullish on lower-tier cities. Meanwhile, it warns that the markets in tier-three or four cities need to be more closely observed as surging home prices may affect affordability, potential demand has been tapped ahead of time and there is more leverage in the market.
Real estate development and investment in China grew 9.1 percent to reach a two-year high in the first quarter, according to the National Bureau of Statistics data released on Monday.
“Last year’s large number of real estate transactions and rising house prices led to the accelerated growth,” said Mao Shengyong, spokesperson for the National Bureau of Statistics, reported Yicai Global. The cyclical nature of property investment means businesses often lag behind, he added, saying the market is likely to slow down and companies’ enthusiasm to put money into property may wane.