Is real estate only contributing 8% to China’s GDP?

According to National Statistical Bureau, from Jan to Sep, the contribution of real estate to GDP is 8%. However,according to CICC research team, in third quarter, property related service accounted for 3.8% of real GDP growth, and 12.3% to norminal GDP. However, this figure is calculated only by construction GDP. It does not include the property related industries. While construction related raw material industry accounted for 5%, furniture and house decoration was 5%, and property finance is 2%.

Citigroup said China is not the only country facing real estate bubble

According to Citigroup report, in Sep, Tianjin, Foshan, Changzhou, and Changsha is exceeding 100% of house voluume turnover. Citigroup said although Chinese real estate industry is in a huge bubble, but the international economy is also facing the same bubble. Current city governments’ restriction on real estate is a positive signal that government is trying to change this situation. Jianlin Wang of Wanda said the biggest problem now is the fast growing in 1st and 2nd tier cities but decreasing price in small cities. The rate of houing vacancy is to high.

Hangzhou Restart the restriction on house purchase

Hangzhou is following Xiamen and Suzhou’ policy on restriction of non-local residents purchasing houses. Non-local residnets is becoming the main force of house purchasing since 2016. After G20, the oursiders purchase rate accounts for 39.3%, and among them, 25.4% purchase two houses.
Economist claims that in a short period, purchasing house is contributing to decrease inventory policy, but in a long period, it will drive up house price. Surrounding cities’ house price may also increase because of Hangzhou’s policy.