Sales at China’s top developers plunge in November as property market stares at year of recession
- Sales at Country Garden and China Evergrande decline even after they lower prices
- Rival China Vanke’s November sales however rise 68pc year on year
Two of China’s top three leading property developers saw their November sales plunge even after cutting prices by nearly a third at some of their projects, as fears of a housing recession grows larger.
China Evergrande, the country’s third-largest property developer by sales, reported on Tuesday that contracted sales declined 29 per cent to 34.1 billion yuan (US$5 billion) in November from a year earlier, a day after Country Garden Holdings, the nation’s biggest developer, posted sales drop of 16 per cent to 33.8 billion yuan.
Country Garden had reduced prices in two cities during the National Day holiday week beginning October 1 as part of a marketing strategy to capitalise on the traditional peak season for property sales. But this led to protests from angry buyers who had paid full price before the discounts were announced.
Evergrande has also slashed prices at some of its new projects in September and October, offering discounts up to 26 per cent of the value of flats.
“The significant price cut has done serious damage to the developer [Country Garden],” said Alan Jin, property analyst at Mizuho Securities.
It was the second time that Country Garden posted a decline in sales, with August’s takings falling 8 per cent to 31.33 billion yuan from a year earlier.
