Four parcels of land in Beijing failed to be sold at auction because of a lack of bidders, indicating a slowdown in the property market, the Shanghai Security News reports.
The city's land statistic center said on Monday the four parcels were all for business and commercial use, which may not have been attractive for developers, the report said.
Auctioneers were asking for 3,832.60 yuan (US$561) per square meter for the largest parcel in west Beijing's suburban Fangshan District, although the price was much cheaper than it was a month ago. The parcel was intended to be used for cultural and entertainment facilities, a parking lot, transportation hub and other business functions.
The article cited one unnamed industry insider who said the main reason behind the abortive land auction was that developers were becoming more rational when making bids on land under a new central government policy enacted last month that implemented a series of tightening measures to try to curb surging property prices.
Under the policy, housing sales have slumped 60 percent in the city, while average transaction prices have remained high.
Nevertheless, the article noted that a recent property analysis indicated that the capital's hot areas were still attracting many real estate developers.
Zhang Dawei, an employee at a Beijing's Zhongyuan Real Estate Agency told the Shanghai Securities News that the capital's land market has been experiencing a continuous decline since the government's new regulation on property prices in April, with an average price of 3,894 yuan (US$570) per square meter, a 34.5-percent decrease from a month ago.
"Most land is sold at bottom prices," said Zhang, according to the article. "The premium price of land has plunged to 8.25 percent, a 109-percent decrease than what it was before the policy, which indicates the policy has started to take effect." Zhang also noted that the cooling down of Beijing's property market would eventually lead to a similar slowdown in the currently overheated housing market, the article said.
