Nov. 22 (Bloomberg) -- China Vanke Co., the country’s biggest publicly listed developer, said it has no plans to cut prices nationwide even as it may adjust them at some of its projects.
About 77 Vanke homes were sold over the weekend at prices 13.3 percent lower than a previous batch at the same project on the outskirts of Shanghai, according to China Real Estate Information Corp. (CRIC), a property data and consulting firm.
“We certainly have no plan of lowering our prices around the country,” Li Jun, the company’s investor relations officer said in a phone interview, declining to elaborate. “Some projects may have a bit of adjustment.”
Developers are lowering home prices on the outskirts of major cities to combat slowing sales after the government expanded property curbs this year. China’s home prices in October posted the worst performance this year, with 33 out of 70 cities monitored by the government falling from September.
About 400 projects are on sale in the country’s financial center of Shanghai, with seven to eight cutting prices each month since March, according to CRIC. Price cuts were as much as 20 percent, it said.
Vanke is also offering discounts to buyers in Beijing and Shenzhen, 21st Century Business Herald reported on Nov. 1. The Shenzhen-based company said last month’s contracted sales fell 33 percent from a year ago, while Poly Real Estate Group Co., the second biggest, posted a 39 percent drop.
‘Tipping Point’
“The majority of the projects offering discounts are newly launched in the outskirts of major cities, because sales of those with high prices in downtown are difficult to boost by price cuts,” said Fu Qi, a Shanghai-based analyst at CRIC.
An index that tracks property stocks on the benchmark Shanghai Composite Index was little changed at the close, after falling as much as 1.1 percent. Vanke rose 0.3 percent, while Poly dropped 0.8 percent.
Longfor Properties Co., a developer controlled by China’s richest woman Wu Yajun, said it sold all 216 units put up for sale at a Beijing project over the weekend with marginal profit. Guangzhou-based Hopson Development Holdings Ltd. sold a project in Beijing with zero profit, Beijing Business Today reported yesterday.
China’s property market has reached a “tipping point,” Nomura Holdings Inc. said yesterday. Home prices may fall by 10 percent to 30 percent next year, according to Barclays Capital Research.
China’s October housing transactions fell for the first time in three months, declining 25 percent from September, according to government data.
Fewer price cuts took place in less affluent second- and third-tier cities because they were less affected by the country’s property curbs, said CRIC’s Fu. China this year increased down-payment requirements and mortgage rates on some homes and imposed purchase restrictions in about 40 cities.