In the first half of the year, the China economic data continued to show a steady and positive trend. Among them, the unemployment rate continued to decline and stabilised at 5% in May and June, while the trend of manufacturing investment rebounding year-on-year and quarter-on-quarter is clear. At present, the mainland is actively increasing the vaccination rate in order to enhance domestic demand, and to improve the consumption situation.
However, affected by uncertain factors such as the emergence of mutated virus strains overseas, precautionary savings will increase. As such, the pace of consumption recovery remains uncertain. Benefited from the accelerated bond issuances, the annual growth in the second half of real estate investment is expected to be within 10-15%; and infrastructure investment is also expected to continue to recover.
In terms of policies and market demand, Mr Yi Gang, the governor of the People’s Bank of China, said in June that the central government will adhere to a prudent monetary policy, especially in focusing on the balance of supply and demand across different economic cycles, and to grasp the intensity and pace of the policy. The country will continue to realise the risk control of the property market from both ends of supply and demand, and to control the inflow of illegal funds into the domestic property market to ensure the long-term, stable and healthy development of the property market.
Sources reported that in the first half of 2021, a total of more than thirty hotspot cities have introduced new regulation and control policies, and the cumulative regulation has exceeded a hundred times, which is higher than the same period in the past two years. Looking forward to the second half of the year, it is expected that the increase in property prices in China in the third quarter will slow down, due mainly to the reduction of leverage, tightening of credit and property market measures.
Property prices in the first-tier cities are expected to rise by approximately 5% in 2021, amid the continued tightening of regulatory policies and accelerating intensity. Among them, the local government will continue to focus on implementing the second-hand housing transaction reference price policy, which is likely to stabilise the overall property market atmosphere.