Companies
Soho China says to buy properties
(Agencies)
Updated: 2010-05-11 15:36
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Soho China Ltd, the biggest developer in Beijing's central business district, may buy land and properties as government measures to cool the market could lead prices lower and developers to sell uncompleted projects.
Chinese home prices may fall by as much as 20 percent and back to early 2009 levels, Soho Chairman Pan Shiyi said at a news conference in Hong Kong today. Soho's projects mainly include shopping malls and offices.
Property prices rose by a record 12.8 percent in April from a year earlier, as steps to stem gains and damp speculation, including restricting pre-sales by developers, curbing loans for third-home purchases and raising banks' minimum reserve requirements, are yet to take effect. The April increase topped an 11.7 percent jump in March that was the highest since the survey of residential and commercial prices in 70 cities started in 2005.
The gain was "normal" as the government had announced most of the measures in the later part of April, Pan said. Prices may fall back to early-2009 levels, when they were lower by between 15 percent and 20 percent, as the government may take further action to curtail growth, Pan said.
China has restricted pre-sales by developers, curbed loans for third-home purchases and on May 2 raised banks' minimum reserve requirements for the third time this year. Beijing became the first Chinese city to limit residents to purchasing one new home starting this month.
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Home prices could fall by more than 30 percent in the first-tier cities as supply is set to rise, Shen Jianguang, a Hong Kong-based economist at Mizuho Securities Asia, said in an e-mail today.
Developers including Guangzhou R&F Properties Co and China Overseas Land & Investment Ltd have already reported slowing sales in April.
Soho has no plans to issue debt to finance any purchases, Chief Financial Officer Sean Wang said today.
