Image source: China Visual

BEIJING, July 18 (TMTPOST) – Guangzhou recorded five consecutive increases in monthly housing prices from February through June as many other cities reported housing price declines, according to monthly data on house prices in 70 large and medium-sized cities released by the National Bureau of Statistics.

From February to June 2022, Guangzhou’s existing house price index rose by 0.6%, 0.3%, 0.5%, 0.2%, 0.5% month-on-month respectively, which was a reversal of the declines from September 2021 to January 2022.

Guangzhou house price increases, although slightly, stood out against the backdrop of price drops registered by other first-tier cities. The NBS data shows that in the first half of 2022, Beijing's existing house prices fall by 0.1% in May from a year earlier despite its overall upswing in the first half. Shanghai in April and May reported zero price growth. Shenzhen rose in April and May month-on-month, but fell month-over-month in other four months of the first half.

However, it does not necessarily demonstrate the recovery of Guangzhou’s real estate market. The volume of existing home transactions in Guangzhou fell but the housing price rose for five consecutive months. The increases are largely attributed to a higher proportion of luxury homes in total transactions, pushing up the average housing price.

The data from Guangzhou Centaline Real Estate Research Institute released on July 11 shows that 42,002 homes in Guangzhou were sold in the first six months of 2022, which was a sharp decline of 44.2% year-on-year.and also a new low in the past five years. From the single-month transaction data, the traditional off-season volume in February was only 4,176 units, and the remaining months were mostly below 8,000 units. By contrast, the average monthly volume of existing house property transactions in Guangzhou in 2021 was 9,759 cases.

The agency's data shows that 10 of Guangzhou's 11 districts saw their existing house transactions fall by both volume and price in the first half of the year, with volume declines ranging between 27.2% and 60.7% and average prices declines between 1.2% and 11.4%. Only in the city center of Tianhe District, the volume of sold existing housing fell but prices rose slightly.

Some analysts argued that the average price of existing homes was likely to be pushed up when the proportion of high-priced properties sold in the central area went up and the proportion of low-priced properties sold in the suburbs decreased.

This is supported by the fact that the volume of existing house transactions in the peripheral areas of Guangzhou fell more significantly compared to the central areas. The three districts with the biggest drops in volume in the first half of the year are Nansha District, Huangpu District and Zengcheng District, which reported volume drops of 61.0%, 55.3% and 54.4%, respectively

The volume of transactions in the central region fell by a narrower margin. Liwan District, Yuexiu District, Baiyun District and Haizhu District fell by 32.1%, 41.1%, 41.1% and 42.3% respectively.