Chinese property prices increase

In spite of regulatory measures taken by the central government, China property prices continue to rise. Property prices in the largest urban areas of the country rose by 11.3% in January.

That rise represents the largest increase since 2005. 

Around the world, people are worrying about negative numbers returning from investment properties. In spite of all of the measures that have been taken by the central government, property prices are continuing to rise in China. The numbers in 70 of the major cities jumped 11.3% in January, the largest increase ever recorded since 2005. Inflation climbed to a new high last month, causing Premier Wen Jiabao to promise to stop excessive growth of property prices in order to focus on building inexpensive homes for families who were unable to afford the high prices of many of the properties that were for sale.

In spite of this, however, new home prices jumped 25% in the western area of China, and rose 20% in the south of China. Wang Tao, the head of the Greater China economics and strategy for the Bank of America Corporation, believes that the rising property prices spell bad things for real estate investors. He believes that the rising property prices will mean financial risks for real estate lenders and will cause other problems in the country.

Despite all of the controversy, investors in China remain optimistic, encouraged by the growth reports and doing all they can to keep the growth steady.

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