Huge tracts of property unoccupied, expert warns
By Wang Ye (China Daily)
Updated: 2006-04-25 08:48
An expert yesterday warned that official figures are seriously
underestimating the amount of property currently lying empty in
China.
According to a first quarter report released by the National
Bureau of Statistics on Saturday, 123 million square metres of space in new
buildings was unused at the end of March, a rise of about 24 per cent
year-on-year.
In the residential sector, 69.8 million square metres of
housing is lying empty, an increase of approximately 20 per cent.
A standard
two-bedroom apartment is about 100 square metres in size, so this means there
are almost 700,000 apartments unoccupied.
"Our statistics only include
the amount of property that has not yet been sold or rented," a bureau spokesman
said yesterday.
However, according to Yin Zhongli, a real estate expert
with the Chinese Academy of Social Sciences, if the space purchased by
speculators but not yet sold on was factored in, the figure might be far
higher.
Speculation in the real estate sector is quite common in China,
Yin said. "Last year's figures in Shanghai showed that up to half of the new
housing sold was not used."
But he could not give exact figures in terms
of real vacancy rates, saying it was a hard to get an accurate number.
Yin
warned a high housing vacancy rate might disturb the market order and trigger a
financial crisis.
Different statistics have shown that the amount of
vacant space in residential buildings has been on the rise in recent years, even
as ordinary consumers complain they can hardly afford to buy a decent
apartment.
In Beijing, for instance, there was 13.7 million square metres
of vacant space in residential buildings in 2005, up by 32 per cent from a year
earlier.
However, a report released by Beijing Normal University's
Finance Research Centre earlier this month said that at least 70 per cent of
urbanities could not afford to purchase new apartments.
The report said
that buildings with vacant space were mainly in the country's coastal areas,
leading property insiders to warn that supply and demand were
unbalanced.
The National Statistics Bureau's report stated that, in the
first three months this year, investment in apartments aimed at low and
medium-income families rose by less than 3 per cent in contrast to the
overall 23 per cent growth rate.
The total investment in the property
sector reached 279.3 billion yuan (US$35 billion) in the first quarter, up 20
per cent over the same period last year.
Statistics also showed a 4 per
cent drop in foreign investment in China's property sector in the first three
months of the year, down to 5.2 billion yuan (US$650 million), while the total
investment in the same period increased by about 25 per cent, reaching 564
billion yuan (US$70.5 billion).
(For more biz stories, please visit Industry Updates) |