Zhengzhou city saw second-hand home sales surpass new homes in August amid concerns over delayed new home delivery
Zhengzhou city saw second-hand home sales surpass new homes in August amid concerns over delayed new home delivery

Zhengzhou city saw second-hand home sales surpass new homes in August amid concerns over delayed new home delivery

The city of Zhengzhou saw second-hand home sales surpass new home sales in August as market concerns about delayed delivery of new homes dampened new home sales.

New residential property sales in Zhengzhou, capital city of Central China’s Henan province, reached 714,300 square meters in August, sliding 23.82% from the prior month and down 2.8% from a year earlier, according to data from China Index Academy, one of the largest independent real estate research companies in China.

A total of 5,904 new apartments were sold last month, sliding 22.87% from the month before and falling 6.48% from a year earlier, showed the data.

In contrast, second-hand home sales by floor area reached 724,400 square meters in August, surging 151.91% from a year earlier and 6,925 units of second-hand apartments were sold, jumping 146.97% from a year earlier.

Analysts say that the rapid year-on-year growth in second-hand home sales was also attributable to lower comparison base in the same period in 2021 when second-hand home sales were sluggish due to insufficient mortgage loans from banks.

For the city of Zhengzhou, it’s rare to see second-hand home sales higher than new homes and it came as home buyers turn to second-home market as the risks of new home delivery in the new home market haven’t been addressed yet.

In the recent two months, second-hand home sales in Zhengzhou has been picking up significantly, with monthly sales hitting historical highs.

According to data from China Index Academy, Zhengzhou’s second-hand home sales by floor area reached 718,200 square meters in July, rising by 27.4%, 34.9% and 83.9% in July from the same period in 2021, 2020 and 2019. In August, its second-hand home sales by floor area jumped by 151.9%, 60.7% and 126.3% from the same period in 2021, 2020 and 2019, showed the data.

In July this year, home buyers across hundreds of Chinese cities refused to pay home mortgage loans as construction of properties they purchased had been left stalled. Among the more than 300 property projects in question, 41 projects were in the city of Zhengzhou.

According to data from E-House China R&D Institute, as of the end of first year, the total area of stalled property projects in Zhengzhou had amounted to 4.4 million square meters, the most among Chinese cities.

In August, Zhengzhou announced a real estate fund worth up to 10 billion yuan ($1.47 billion), becoming the first Chinese city to set up such fund after the nationwide mortgage boycott. Read more …

Earlier in September, the city vowed to start building all stalled housing projects within 30 days using special loans, reported Chinese news outlets including The Paper, citing a notice dated September 6 released by the local government. Read more …