of levers of control, should the property market slide faster than expected.” For now, all signs point to China continuing to lean on those controls. Te
country’s economy, while no longer producing year after year of double- digit growth, still expects 2012 GDP of around 9 per cent. Whatever the impact may be, China’s National Statistics Bureau reports
that home prices only rose during December in two of the 70 cities it measures. Prices in 52 of those markets fell. Tree months ago, Shanghai property developers started slashing prices on their latest luxury condos by up to one-third. Crowds of owners who bought apartments at full price converged on sales offices throughout the city, demanding refunds. Some angry investors went on a rampage, breaking windows and smashing showrooms. And similar steep price reductions are upending real estate markets
across China. Centaline, a leading property agency, estimates that developers have built up 22 months’ worth of unsold inventory in Beijing and 21 months’ worth in Shanghai. Chinese radio reports that half of all real estate agents in the southern city of Shenzhen have shut up shop. According to Centaline, more than 100 local government land auctions failed last month, and land sale revenues in Beijing are down 15 per cent this year. Lon John, the vice rector of Chinese University of International Business and Economics said in a recent seminar that total trade between China and
the Arab world was likely to hit US$190billion when the final tally for 2011 is revealed. Te figure represents a significant increase on 2010 when the year-end
total reached US$145.4billion. It was just US$36.4billion seven years ago, according to the Saudi Press Agency (SPA). Meanwhile, the investment between the two sides is expanding every
year. By the end of 2010, the total amount of Chinese investment in Arab states had exceeded US$15 billion and investment from Arab states in China reached US$2.6 billion cumulatively. And the Economist Intelligence Unit (EIU) said in a report that China is
expected to be the GCC’s most important economic partner by 2020. Ironically, some are suggesting China should learn the lessons of Dubai. Professor Huang Yiping of the Chinese Centre for Economic Research at
Peking University said: “In China, soaring real estate prices have led to deep concerns over expanding bubbles. Especially against the backdrop of the world economic slowdown, some local authorities have turned to the real estate market to fuel the local economy. “Both the ratio of home prices to per capita incomes and the ratio of
vacancies are indications that bubbles in the Chinese real estate market have expanded to a dangerous position. Te Dubai experience tells us that once bubbles occur, they’re sure to burst, which will inevitably lead to steep declines in home prices” l
APRIL 2012 I CITYSCAPE I 21
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