Public anger in China spreading as property prices drop
Sales are usually brisk at this time of year, but so far the figures are grim – and people who’ve already bought are protesting against price cuts
Chinese property developers can usually count on September and October to be their “gold and silver” months for sales, but this year turned out to be different.
Not only were their sales figures grim for September, but the seven-day national holiday last week also brought at least two fangnao incidents – when homeowners protest against price cuts offered by developers to new buyers.
These protests are often directed at sales offices, with varying levels of intensity – from throwing rocks to holding banners and putting up funeral wreaths. As home ownership has remained the most important channel of investment for urban households in China in the past decade, price cuts have become increasingly unacceptable and a cause for social unrest.
In eastern Jiangxi province last week, angry homeowners who paid full price for units at the Xinzhou Mansion residential project in Shangrao attacked the Country Garden sales office after finding out it had offered discounts to new buyers of up to 30 per cent.
A similar incident took place in suburban Shanghai, where the same developer slashed prices at another project called One Mansion by a quarter.
“Property accounts for roughly 70 per cent of urban Chinese families’ total assets – a home is both wealth and status. People don’t want prices to increase too fast, but they don’t want them to fall too quickly either,” said Shao Yu, chief economist at Oriental Securities.
