Why India's real estate surge doesn't make it a substitute for China
Yet among the leading economies in the region, the performance gap between China and India is far and away the most palpable divergence in Asian real estate. That the region's two biggest emerging markets, and the world's
most populous countries , are expected to play a bigger role in driving global growth in the next five years makes their diverging fortunes all the more striking.
In China, the housing crisis has damaged confidence to such an extent that the government has considered scrapping the discredited pre-sales model and forcing developers to offer only completed flats, mainly to restrict supply and help stabilise prices.
Unfinished properties accounted for 90 per cent of new home sales when the crisis erupted in 2021.
While there were signs of green shoots earlier this year, the contraction in
new and second-hand house prices is deepening again on a monthly basis. Meanwhile, real estate investment was down 10.7 per cent in the first five months of this year. In the commercial property sector, sentiment in mainland China is the most downbeat among the leading real estate markets in the Asia-Pacific, according to the results of a CBRE survey of leasing activity in the office, retail and industrial markets on June 12.
While Chinese equities – particularly
Hong Kong-listed shares – are attracting more interest from global investors this year, partly because of a stronger willingness to diversify portfolios away from the United States, mainland China and Hong Kong are the least-preferred commercial property markets in the Asia-Pacific among cross-border investors.
In China's office market, net take-up has collapsed since 2021 while supply has remained at pre-pandemic levels, leading to an acute imbalance that pushed up the average vacancy rate among 10 leading cities tracked by CBRE to 23.5 per cent in the first quarter of this year. In Shanghai and Beijing,
vacancy rates are among the highest in the region while rents for grade A offices fell at the sharpest pace in the first quarter.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South China Morning Post
25 minutes ago
- South China Morning Post
10% year-on-year sales boost expected for Hong Kong eateries on handover holiday
Hong Kong's restaurant industry is anticipating a 10 per cent boost in business on Tuesday compared to last year, with an industry leader noting that the increased number of over 3,800 eateries offering discounts to celebrate the city's handover to Beijing will spur local consumption and help ease the sector's woes. Advertisement Simon Wong Ka-wo, president of the Hong Kong Federation of Restaurants and Related Trades, expressed optimism as the city celebrated the 28th anniversary of its return to Chinese sovereignty on Tuesday. 'The different discount packages offered by restaurants and shopping malls will encourage more residents to consume,' Wong told the Post, noting that the number of participating restaurants had jumped from 2,000 last year to 3,800 this year. The offers, including a 29 per cent discount at Hong Kong-style cafe chain Tai Hing and its 15 sister restaurant chains, led to bustling scenes at eateries across the city. At Tai Hing's Tsuen Wan branch, there was a constant queue of over 20 people, with the number at times exceeding 30. Its Causeway Bay outlet was packed with diners early in the morning. Advertisement Other businesses such as Chinese teahouse All Forum and bakeries such as Arome also took part in the promotional campaign by offering discounts.
South China Morning Post
an hour ago
- South China Morning Post
On anniversary of Hong Kong handover, John Lee vows to be a ‘reformer' amid challenges
Hong Kong's leader has vowed to be a 'reformer' that rises to challenges rather than becoming a 'complacent idler' in the face of the economic restructuring and geopolitical tensions, as he enters his fourth year in office. In a speech to mark the 28th anniversary of the city's handover to Chinese rule, Chief Executive John Lee Ka-chiu on Tuesday also laid down three priorities in his governance: boosting development backed by security; expediting the Northern Metropolis megaproject near the border with mainland China; and improving residents' livelihoods. Lee said he had full confidence in Hong Kong's development, as long as the city was committed to fully seizing opportunities, undertaking reforms and fostering innovation. He cited a Chinese saying that describes a hard task becoming easy with determined efforts and an easy task getting difficult with inaction. 'We would rather be reformers who rise to challenges than become complacent idlers,' Lee declared at the reception held at the Hong Kong Convention and Exhibition Centre in Wan Chai. 'Amid an ever-changing geopolitical landscape and constantly increasing uncertainties, Hong Kong is able to showcase exactly to the world the certainties of safety, stability and development opportunities. These are precisely what the world needs and seeks.'
South China Morning Post
2 hours ago
- South China Morning Post
Why China's yuan is forecast to extend gains against the US dollar through 2025
Market optimism for the Chinese currency continues to rise, with analysts projecting the yuan to appreciate further against the US dollar amid a stronger-than-expected domestic economy and growing concerns over US debt sustainability. Advertisement On Tuesday, the People's Bank of China set its daily reference rate at 7.1534 per US dollar – strengthening from Monday's 7.1656, and the strongest level since early November. In June, the onshore yuan appreciated by 0.41 per cent against the greenback, bringing its cumulative gains to 1.2 per cent for the second quarter and 1.86 per cent for the first half of the year. 'Compared to late April, onshore clients have turned less bearish on China's near-term growth outlook, as macro data has been more resilient than previously feared so far this year, despite notable divergence between exports and domestic demand,' Goldman Sachs analyst Lisheng Wang wrote in a note on Sunday. At the same time, investors have grown increasingly concerned about the sustainability of US government debt, expecting the dollar to further depreciate amid fading confidence in US exceptionalism, loose fiscal policies and rising long-term financing costs, Wang added. Advertisement The Wall Street investment bank forecasts the yuan to strengthen further, breaking the 7 per dollar level in six months and 6.9 in 12 months.
