Prospective homebuyers enticed off sidelines in Shenzhen after Beijing picks it as new special economic zone

By Pearl Liu / | September 11, 2019 11:57 AM SGT
Home sales jumped suddenly in Shenzhen, after Beijing announced it had picked the southern city as a new special economic zone to carry out wide-ranging reforms in medical, legal and other sectors.
Last weekend " the first after Beijing's announcement on August 21 " total new home sales jumped 10 per cent from the previous weekend, with 173 flats sold.
"It's been quite vibrant since last weekend, as home seekers who used to be hesitant are actively coming to us and asking about available homes," said Xu Xingchun, a property broker based in Nanshan, where tech giants including Tencent, ZTE and drone-maker DJI are located.
Homebuyers are betting that the gift for the city will eventually translate into a handsome profit on their investment.
The boost for Shenzhen comes as homebuying throughout China has cooled, with China's top 100 developers reporting an average fall of 29 per cent in contracted new home sales in July.
However, home prices have continued to climb in most major Chinese cities, despite local government curbs, although Shenzhen " one of the most expensive housing markets in the world " was one of only five of the top 70 Chinese cities where home prices remained unchanged last month, according to data from the National Bureau of Statistics.
Shenzhen's government has tried to cool prices since 2017 through the threat of withholding permits to developers to sell new flats if they price them too high. It also restricts who is allowed to buy homes, which reduces demand and flat hoarding by speculators, and limits residents to no more than two flats, with the second one's mortgage costing more.
Shenzhen is ranked as the fifth most expensive housing market in the world, with an average 87 square metre flat (936 square feet) selling for US$680,283.
Shenzhen " part of the Greater Bay Area, which is comprised of Hong Kong, Macau and nine Guangdong cities " allows Chinese residents to buy...