China's online property market looks set to face a prolonged downturn according to the latest research report from Deutsche Bank, reports South China Morning Post.
“The property market is entering a long winter for at least six months, we believe,” said Alvin Jiang and Alan Hellawell, analysts at Deutsche Bank, in their latest research report. “The weakness in the property market will last until at least late 2017.”
Chinese officials introduced a series of strict policies to manage property prices and limit property transactions during the middle of 2016. These included about 20 Chinese cities that have announced a series of tightening measures since the end of September in order to control the rapid home price increases this year.
New and secondary home sales have suffered from the tightening measures while advertising revenue including listing and online marketing services will take time to see the full impact as developers and sales agents cut their advertising budgets, Jiang said.
“Compared to the secondary home market, we believe the new home market is more influenced by these tightening measures across the cities, as most of the measures addressed developers, the down-payment ratio and the citizenship requirement of buyers, while fewer measures affect the secondary home market,” Jiang said.