Housing bubble? What housing bubble? One Shenzhen developer rented out an entire stadium over the weekend in order to host 10,000 potential buyers, who ended up spending 6 billion RMB on properties in only 6 hours.
The new development complex is located in the city’s Longhua district and includes some 1,637 apartments, all of which have now been sold. Sorry. According to NetEase, these apartments cost an average of 43,500 yuan per square meter. The average price for new homes in Shenzhen is 33,599 yuan per square meter, but the average price for second-hand homes nearby is around 50,000 yuan.
At 1 billion RMB per hour, according to Caijing, the real estate rock concert had the largest volume of sales for any development in the past 10 years.
For years some analysts have seen clusters of seemingly unoccupied high-rises popping up throughout the country and predicted a potentially devastating housing bubble bursting in China; however, real estate developers seem less worried. Franco Leung, vice president and senior analyst at Moody’s Investors Service told Forbes last week that nationwide property sales are likely to exceed 10% growth thanks to monetary policy and changes to lending and other home-buying rules for investors.
Still, real estate is currently a much tougher business in lower tier cities, leading developers to rent out foreigners, throw out hongbao and strut out scantily clad girls to help sell some homes.
Check out this analysis of the Chinese housing market done by the China Economic Review last week, showing why we shouldn’t be calling this a comeback.
[Images via NetEase]