Taiwanese bullish on Shanghai's house price
By Guan Xiaomeng (Chinadaily.com.cn)
Updated: 2005-09-23 11:26

Polls say that nearly as many as 80 percent of the Taiwanese in Shanghai believe that Shanghai's housing prices are likely to exceed those in Taiwan despite a 15 percent fall in Shanghai's housing market due to a second round government macro-control jointly carried out by the Ministry of Construction and People's Bank of China, China's central bank targeting to cool down the over-heated real estate market since March.

Due to the downward price, the number of deals in Shanghai's real estate market fell by more than 70 percent from June to August because quite a number of real estate agents had to turn to renting houses to survive until prices pick up.

On one hand, the real estate agents were reluctant to sell houses at the fallen prices; on the other hand, there is an increasing demand for house renting from the Taiwanese and foreign businessmen in Shanghai.

In spite of that, as many as 79 percent of poll respondents said future increases in Shanghai's house prices are likely to overrun Taiwan's and nearly 90 percent of them would not rule out the possibility of purchasing Shanghai properties. That reflects Taiwanese confidence in the future of Shanghai's real estate market.

Nevertheless, nearly 60 percent of respondents point out that the investment climate in Taiwan is better than that in Shanghai in some aspects. They said that includes policies, lending rates, and trading risks. Among the negative factors, uncertainty over government policies ranks as the top worry.

Seen from the long prospect, against the backdrop of the sustainable accelerated economic growth, the real estate market will likely experience a price surge driven by the yuan's revaluation, the 2008 Beijing Olympic Games, and the 2010 Shanghai World Expo.

The polls also show that the top three preference districts that Taiwanese choose as home locations are Changning, Pudong and Xuhui Districts while Jing'an is fourth, but regarded as the best choice by Shanghai citizens.

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