Regular readers will know my penchant for the rhetoric of Mark Twain and this example dates from June 1897. At the time, a journalist was sent to interview Twain believing him to be near his death; in fact it was his cousin who was very ill. Writing later that month in the New York Journal, he said “the report of my death is an exaggeration”; note, too, that is oft misquoted as “the rumours of my death have been greatly exaggerated”.
And, despite the Christmas wreath from the PBOC of 25 basis points on interest rates, the same could be said of the Chinese real estate market. Similarly, its recovery was assisted by today’s news that Government departments cannot agree on how to institute the much-touted property tax. So it will be, at least, delayed and, in morning trade the property sub-index within the Shanghai Composite was up 4.8% (although, to be fair, this does follow a truly dreadful 2009 when the former slumped 28%, the most among the Composite's five industry groups).
I have also discovered two (admittedly) early contenders for ‘quotes of 2011’. The first comes from Jingxi IM: “speculations about the delay in the introduction of the property tax helped trigger the rally. Property prices are still at high levels after a year’s crackdown and that has led some investors to believe that prices won’t come down and property stocks are much undervalued”.
Similarly, CLSA Asia Pacific said: “China property is the cheapest property sector around Asia. Investors are starting to feel that risk-reward is looking pretty good”.
Plus as an extra, Guotai Junan Securities says property stocks could rebound 25% by the middle of January; albeit that there is sting in the tail here insofar as it expects constraints on the Sector to be added later in the first half.
That said, Premier Wen lamented on national radio in December that measures to control the Nation’s property market were not well implemented. “We introduced about 15 measures this year but it appears that they were not well implemented. I believe that after some time, the home market will return to a reasonable level with our efforts”. He also intends to ramp up public housebuilding with a unit target of 10 million (worth Yuan 1.3 trillion) in 2011 – which is a near three-fold increase on last year’s estimated outturn (3.7 million units). What’s more, some commentators say that this it not nearly enough with a backlog of some 20 million.
“He who fights and runs away will live to fight another day”
Demosthenes 338 B.C.
Holiday headlines
- China to delay property tax after Government disputes, says Century Weekly
- CIC backs Manhattan tower as China continues to favour investment in US property
- Hutchison Whampoa advances after $734 million port and property acquisition
- China to assess foreign property investment on a regular basis
- Beijing and Tianjin plan for urban integration
- China's land sales may have hot $302 billion last year; an increase of 33%
- Premier Wen says measures to restrain home prices were not well implemented
- New public housing units target of 10 million (worth Yuan 1.3 trillion) in 2011 – a near three-fold increase on last year’s estimated outturn; but it still needs more, says ISI
- State-owned companies agree to $45 billion of projects in Guizhou in south west China
- China property stocks may rebound 25%, says Guotai Junan
- Evergrande buys site for Yuan 1.4 billion in Guangzhou
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