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Wuhan sees rebound of housing sector after two-month freeze

Aerial photo taken on Feb. 17, 2020 shows buildings under construction in Nanguan District of Changchun City, Northeast China’s Jilin Province. (Xinhua/Zhang Nan)

The housing market in Wuhan, Central China’s Hubei Province, is recovering after a two-month freeze amid the COVID-19 epidemic, with more than 90 percent of developers getting back to work and transactions resuming.

On March 30, Wuhan – the city hit most by COVID-19 – for the first time in a long while released commercial housing transaction statistics, showing 51 deals. The number has kept rising: In the five days until Friday, there were 299 deals, according to National Business Daily.

As of Thursday, there had been auctions for 25 plots with a value of 15.3 billion yuan ($2.16 billion) in Wuhan.

“The recovery in Wuhan shows the market across the nation has the potential of rising,” Yan Yuejin, research director at E-house China R&D Institute, told the Global Times on Monday. He even predicted that the housing market could get back to normal in the second half of this year.

The nation’s housing market was seriously hurt by the epidemic, with sales suspended in January and February in more than 60 cities, leading to a dramatic decline in new home transactions.

Data from the National Bureau of Statistics showed that China’s investment in property development plunged 16.3 percent year-on-year during the first two months. Investment in residential buildings fell 16 percent from a year earlier.

To stimulate the market, some cities further relaxed housing control policies.

On March 16, a district in one first-tier city – Guangzhou, capital of South China’s Guangdong Province – said those who had worked locally for one consecutive year, could qualify to buy houses in four towns. 

Previously, anyone who wanted to buy a house in Guangzhou had to have paid social security contributions or personal taxes for five consecutive years.

“The local government has shown its willingness to stimulate the housing market, and it shows the government is under pressure in terms of fiscal income,” Song Ding, a research fellow at the Shenzhen-based China Development Institute, told the Global Times Monday.

However, the nation is slowly getting back to normal, and there have been some positive signs in the housing market. 

Construction had resumed on about 85 percent of the housing and urban infrastructure projects in China as of Wednesday, the Ministry of Housing and Urban-Rural Development said on Friday.

As of Wednesday, about 158,700 housing and urban infrastructure projects out of a total of 186,600 across the nation had accelerated construction work, the ministry said in a video conference.

However, Song said that “the housing market in China will find it hard to achieve a fast rebound and the market is still weak, given the fact that China still faces pressure from the virus.”

Xu Hejian, a spokesperson of the Beijing municipal government, on Sunday warned that Beijing is probably facing a situation of long-term epidemic control, and there is no chance to call off the city’s prevention and control work within a short time.

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