Home sales in Beijing decline by almost half

Buyers take wait-and-see attitude as inventory grows among developers

Home sales in Beijing, a city that is regarded as a barometer of China's overall property market, fell to a nine-year low in the first half of the year, raising concerns about the prospects of the country's real estate market.

A market that's not such a hot property

Realty price swings may pose short-term risks

There were 22,782 new homes sold in Beijing in the first six months (as of June 26), which constituted a slump of 48.7 percent over the same period last year, when 44,468 units were sold in the capital, according to Centaline Group data.

Sales by floor space plummeted by 48.1 percent, while by value slumped 38 percent, the brokerage firm said.

The white-hot market, following Beijing's decision to impose a 20 percent tax on homeowners' gain from housing sales, provided a high comparison base for this year's huge drop. But it is not the entire explanation, analysts said.

Zhang Dawei, chief analyst with Centaline Group's Beijing branch, said the weakening of the overall market, as well as expectations of more supply from government-subsidized housing projects, have pushed potential buyers to the sidelines in anticipation of further price drops.

Sales and prices will continue to decline in the coming months if mortgage policies aren't relaxed, he said.

The widespread "wait and see" attitude among homebuyers has ravaged sales figures and pushed the city's inventory to a record high.

Inventory exceeded 80,000 units as of June 20, according to Centaline, its highest point since January 2013. The stockpile of unsold units climbed rapidly when turnover cooled after the Spring Festival period.