1 yuan = 14 U.S. cents

Andy Xie, a Caijing guest economist with Rosetta Stone Advisors, said it may take more than three years for China’s real estate sector to revive.


Property developer Pan Shiyi, chairman of Soho China, also expressed a negative view. “If the government had issued supportive policies for real estate sector in March, the market would have soon rebounded,” Pan said. “If it had saved the market before the Olympics in August, the market may have revived after awhile.
At the same time, Ren said, completed projects accounted for just 10 percent of all October construction projects, which means about 1 billion square meters of unfinished housing may be left incomplete. “The outlook is very pessimistic,” he said.
For the sector to revive,franklin et marshall, Pan called for adjusting macroeconomic policies s well as entrepreneur business practices.
Bubble or not
As one who in 2004 warned about irrational growth in China’s real estate sector, Xie said property investment was excessive due to exaggerated expectations of returns.







Hitting Bottom?
Experts agree China's real estate market is in a slump. But they disagree over how bad it will get,chaussure louboutin, and what triggered the downturn.


However, Xie said property developers should accept blame. Most developers overemphasized high-end housing and ignored the demands of middle- to low-income people,ralph lauren pas cher, leading to an imbalance between supply and demand, he said.

According to the National Statistics Bureau, the average property price in 70 major Chinese cities declined 0.5 percent in November from a month earlier. It was the fourth consecutive monthly decline.





Developer Ren Zhiqiang, president of Beijing Huayuan Group, said housing sales have totaled 450 million square meters so far this year and should finish 2008 at 600 million square meters – down 170 million square meters from 2007.
Wang linked government credit controls to the distress,franklin marshall, and said the sector’s future would be determined by government policies.

But in light of the government’s recently announced 4 trillion yuan economic stimulus plan, Pan said, “I don’t see when” a revival “will take effect.”
China’s property outlook index,adidas football chaussures, which covers price and investment trends in the sector, fell to 98.46 in November from 99.68 in October. The index has been falling since it peaked at 106.59 in November 2007.











Wang Qing, Morgan Stanley chief economist for China, also described the sector as healthy overall, as average housing price growth has been balanced with personal income growth since 2002.

Xie said to accelerate buying of housing inventory, developers should consider slashes prices of some projects, and the government should loosen controls on mortgages while reducing taxes for home buyers.
With home sales and prices falling cross the country, China’s real estate sector is experiencing one its worst downturns. An era of high profits is over and restructuring has just begun.






Pan blamed the distressed real estate sector to the global economic slowdown and the Chinese government’s policy control. “Half of the problem is because of the U.S. financial crisis, and half is because of macroeconomic control,” he said.
By staff reporter Han Wei


Ren called for a tax cut or rebate for house buyers to encourage consumption. “Only a tax reduction can save the market effectively,” he said, and predicted “related policies will be issued no later than next January” by the government.
At the same time, Wang said the real estate sector will be crucial to China’s economic development. If sector investments decline by less than 10 percent, he said,polo ralph lauren, that along with the government’s stimulus plan will allow China’s economy to have a successful “soft landing” in 2009. But if investments in real estate drop by more than 30 percent,adidas f50, even the stimuli may not be able to prevent the economy from a hard landing, he said.
But Cai Hongping, chairman of China Investment Banking at the Swiss bank UBS, disagreed. He said, over the next 10 years, China’s real estate market will remain strong. Demand will be high because more than 300 million Chinese will need to buy homes.











But another property developer, Feng Lun,polo ralph lauren pas cher, chairman of the Beijing Vantone Real Estate Co. Ltd., was more upbeat about the future. He said economic fluctuations need not be fatal to enterprises. Companies should learn how to react properly in crises, he said, rather than cower.


A Way Out



1 yuan = 14 U.S. cents

From the Caijing Annual Conference



“The current problem in China’s real estate sector is neither an economic problem, nor a bubble,” Wang said. “It is actually a social problem which reflects China’s existing wealth gap issue.”









This is the market scene described by property developers and economists December 12 at an economic forecast conference organized by Caijing. The consensus was that the real estate sector will play a crucial role in determining China's economic trends in 2009. But their views of the industry’s long-term outlook vary.

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