(Yicai Global) June 19 -- The number of new housing contracts signed online continues to decline in Beijing, data shows.
From June 1 to 15, the number of new commodity housing (excluding affordable housing) contracts signed online was 961, a decline of 28.2 percent from the first half of May and 49.3 percent from the same period last year, data from market research institute B.A. & 5I5J Group shows, as chinanews.com reported June 18.
The number of villa contracts was 174, down 15.1 percent from the same period in May and 67.7 percent from the same period last year. The number of self-use commodity housing contracts was 20, an increase of 17 from the same period in May, but a decrease of 32 from the same time last year. The amount of commodity housing for other purposes was 767, down 32.1 percent compared with the same period in May, and down 41.1 percent over the same period last year.
The introduction of strict new real estate rules has had an immediate effect in reversing market expectations, cooling the property market and stabilizing prices, said Hu Jinghui, vice president of B.A. & 5I5J Group. From the current transaction volume, the actual number of contracts signed declined significantly than before the introduction of the new rules, and the transaction volume has already hit rock bottom.
Increased controls over real estate developers and market entry of real estate projects by the new rules have shrunk the supply. For housing buyers, the increased down payment means increased pay pressure, resulting in a significant reduction in demand, said Hu. Shrinking demand accelerates the ongoing decline in trade volume
Beijing not only witnessed a declining transaction volume of new housing in the first half of June, but also a continuing downturn in the second-hand home market. The number of second-hand housing contracts signed online in the first half of June was 4,082 in Beijing, a decline of 13.6 percent from the first half of May and 33.3 percent from the second half of May, continuing the downward trend, B.A. & 5I5J Group data shows.
At present, Beijing's second-hand housing market transactions have not yet reached their 2014 nadir -- meaning market cooling space is still available -- but the decline will gradually narrow and stabilize at low, said Hu. With the continuing downtrend in trading volumes, a more pronounced fall in already-declining housing prices will occur.