House price confusion clouds macro policies
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According to figures published by the National Bureau of Statistics (NBS) yesterday, house prices in 70 major Chinese cities increased at an average annualized rate of 12.8 in April.
Haikou led the growth at 64.3 percent, closely followed by Sanya, Wenzhou, Jinhua and Beijing with rises of 58.2, 26.1, 23.8 and 21.5 percent respectively.
The figures cast doubt on the effectiveness of recent polices aimed at cooling the property sector. China began to apply restrictive policies in December 2009.
This year, government departments including land and resources, finance, and taxation adopted a combined approach to curb the housing bubble, but so far with little effect.
But while government figures show house prices still soaring, some private surveys indicate prices of Beijing residential property fell by as much as 8000 yuan (US$1171.30) per square meter in April.
It is possible neither the NBS nor private figures are accurate. NBS data collection is indirect while private agencies rely on suspect figures from realtors.
New policies seem to have halted the upward momentum in Beijing's house prices. But so far, very few realtors are offering genuine discounts.
And recent rumors that house prices are falling down may turn out to be a ruse to tempt people into buying.
China's property bubble is the result of chronic uncontained growth and efforts to curb it have so far been disappointing. Officials in the NBS realize there are problems with real estate statistics but have yet to make concrete improvements.
