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An aerial view of a large housing complex in Shanghai, China
China’s property market accounts for around one-fifth of the country’s gross domestic product and is often seen as an indicator of the direction of travel for other sectors, particularly construction and commodities.
“I think the key thing to look out for in China this year is going to be the property sector, as it always is,” Seb Lewis, content director for China at S&P Global Platts, told CNBC Wednesday.
“Last year was really strong, very good strong house prices, and I think we’re going to see those house prices contained by the government via policy responses, which is going to generally constrain growth, especially in the commodities sector,” he continued.
Chinese authorities have been issuing further restrictions this year, including increasing minimum down payments on second homes and curtailing individual mortgage loans at 25 years.
Hong Kong followed suit earlier this week, announcing that it would curb purchases of second homes in an effort to cool sky-high prices, which have jumped 364 percent since 2003. The move reflects the growing influence of China on the former British colony after one of its picks, Carrie Lam, was elected as head of the city last month.
