China's push for higher home quality risks further stressing developers, analysts say
China is rolling out measures to improve the livability of mainland flats in an attempt to boost sales and shore up the slumping
property sector , but analysts warned the standards for 'quality homes' could further strain cash-strapped developers.
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This year's government work report, an annual policy document delivered by
Chinese premier Li Qiang during the March '
two sessions ' meetings that set the country's policy playbook for the year, mentioned the term 'quality homes' for the first time.
Ni Hong, minister of housing and urban-rural development, laid out some of the standards in a briefing on Sunday, including a minimum ceiling height of 3 metres for all residential property, up from 2.8 metres previously. He added that 'new technologies' should be used to address issues such as sound insulation and odours, and that homes should be available in different sizes and price ranges to meet diverse needs.
Affordable housing and redevelopment of old homes would be top priorities, he said.
'Since most new homes now come with fully finished interiors, the actual usable ceiling height is reduced,' said Lu Wenxi, an analyst at Centaline Property. 'After accounting for flooring and other finishes, the net height can end up around 2.6 metres, which can feel quite cramped.'
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Future projects were likely to follow the guidelines, enhancing quality of life and promoting higher construction standards for residential buildings, he said, adding that the measures would help boost sales.
'The guidance is in line with Fitch's expectation that a greater portion of [future] housing demand will come from homebuyers looking to upgrade their homes,' said Shi Lulu, director of Asia-Pacific corporate ratings at Fitch Ratings. 'This shift in demand structure is likely to support the overall average selling price for new homes, as these properties tend to be of higher quality and thus command higher prices.'
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