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Developers resorting to more ploys to de-stock

(Xinhua) Updated: 2016-02-04 15:19

Nanning -- As unsold homes mount up, Chinese developers have lost their appetite for land and have become focused on getting rid of inventory.

The sales center of a new development in Nanning is offering discounts of 80,000 yuan ($12,100) for each home bought. The average price per square meter is about 8,000 yuan.

A lack of shops and restaurants, coupled with poor transportation has scared buyers off. "The nearest wet market is too far from here, and buses are too few," said one potential buyer, prioritizing convenience over price.

The heady days of housing consumption are gone. New home buyers are more savvy now, with little expectation of buying low and selling high. In response, developers are working with local governments to improve the overall living conditions in new neighborhoods.

In addition to reining in the number of new homes, Hunan and Shandong provinces proposed better supporting facilities in their government work reports.

Public transportation, water and power supply and sewage systems are standards for a new neighborhood today. Hospitals, parks, schools and shopping malls are increasingly seen as "musts" in the eyes of young buyers.

"We are not just selling a home, but a modern and comfortable lifestyle to our customers," sales consultant Feng said.

Developers in some cities have integrated their products with tourism, retirement or education to reach targeted consumer groups and revive the sluggish market.

"Property de-stocking is not merely an economic problem, but a social issue as well," said Luo Guo'an, a sociologist from Guangxi Academy of Social Sciences.

According to Luo, local governments have been inclined to connect property de-stocking with the mass urbanization of residents in rural areas.

To increase the number of potential buyers, Qian Xueming, a member of the people's political consultative conference in Guangxi, proposed that banks should provide preferential loans to migrant workers who have stable jobs and incomes in city.

North China's Inner Mongolian autonomous region is also considering a proposal to offer loans to herdsmen willing to buy homes and live in cities.

The commission of housing and urban-rural development of Hunan, a major agricultural province, has encouraged some departments to roll back home purchase restrictions for rural residents to help them settle in cities.

Restrictions have been also loosened for urban residents using public housing accumulation funds, allowing them to apply for more loans with favorable terms.

"More supportive policies are expected to be unveiled for the property sector," marketing director of a real estate company Lin Qu predicted. "House prices remain high in many cities, which means developers still have huge room for future promotion."

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