All Chinese people dream and work hard just to buy a house, preferably without a mortgage. However, soaring housing prices in China continue to turn those dreams into nightmares. Here are some quick facts about housing prices in Beijing and Shanghai.
Housing prices in Beijing
Back in 2015, being the capital of China, Beijing was already 8th among the world’s top 10 cities for housing price growth. Policies for lowering down payments for first-time buyers set by the central bank stimulated purchasing demand and consequently triggered a rise in prices. In Beijing, housing prices have been rising since 2000 with a drastic price rise in 2009 reaching an average of 20,000RMB per meter square.
Since then housing prices in Beijing have been growing steadily and now range from 25,000RMB to 11,0000RMB (about $3,600 to $16,000 respectively) per meter square depending on the area. However, it is said that there has been a slight drop in home prices recently in Beijing. Could this be an ideal time to purchase a property?
Housing prices in Shanghai
Shanghai topped the housing price list with an average of 42,000RMB per meter square. In Shanghai’s high-end market, the average residential property price has skyrocketed and exceeded 70,000RMB (around $10,000) per meter square.
Shanghai is a popular destination among Chinese and foreign job-seekers, as well as businessmen, therefore some local people think “outsiders” contribute greatly to the rise of housing prices. Indeed, increasing purchase demand does play a role here when it comes to housing prices. However, the local government still needs to take the initiative to stabilize the real estate market and make housing more affordable.
What to do about housing prices in Beijing and Shanghai?
Problems with high housing prices in Beijing and Shanghai have caused heated discussions among property developers and ordinary Chinese people. Some people believe that price bubbles do exist in China and policymakers are well aware of how housing price bubbles can harm China’s economy. Maybe it’s time for them to take measures to prevent further price growth.