Apartment Discounts Begin in China from Early Year... "Reflecting Gloomy Market Sentiment"

[Image source=Reuters Yonhap News]

[Asia Economy Beijing=Special Correspondent Sunmi Park] Hengda Group, a major Chinese real estate developer, has launched New Year apartment discounts. This indicates that the real estate market situation this year will not be easy due to the slowdown in China's economic growth.

According to Bloomberg on the 3rd, Hengda Group recently started nationwide apartment discount sales. If you purchase an apartment built by Hengda Group anywhere in China by February 20, you will receive a 13% discount. An additional 5% discount is given if the apartment is purchased through a company employee's recommendation, and a 7% discount is available if the payment is made in a lump sum.

Hengda Group has often held apartment discount sales around the Spring Festival (Chinese New Year) when apartment purchases surge, but this year's discount event is characterized by being held earlier than usual and lasting much longer.

In particular, this discount is noteworthy as it comes after Hengda Group announced its lowest annual sales growth target in the past eight years. Hengda Group set this year's sales (contract basis) target at 650 billion yuan, 8% higher than last year. This sales growth target is the lowest since 2012 (8%). The sales growth targets for 2018 and 2019 were 22% and 9%, respectively.

Bloomberg interpreted the earlier and longer New Year apartment discount event as reflecting the real estate industry's concerns about the market outlook this year.

China's housing price growth rate declined for six consecutive months until November last year.

Meanwhile, amid concerns that China's economic growth rate may fall below 6% this year, news of price discounts has also emerged in the automobile market from the beginning of the year.

On the 3rd, Tesla announced through its official WeChat account that from the 7th, the China-made Tesla 'Model 3' vehicles will begin delivery to the public, with prices lowered by 9% from the initially set 355,800 yuan to 323,800 yuan. Applying government subsidies, the price starts from 299,050 yuan (approximately 49.98 million KRW).

The automobile market is a representative sector directly hit by the contraction of domestic sales due to the slowdown in China's economic growth. According to statistics from the China Association of Automobile Manufacturers, new car production and sales in China from January to November last year decreased by 9% and 9.1%, respectively, compared to the same period the previous year. The association forecasts that this year, China's automobile sales will decrease by about 2% to 23.31 million units compared to last year.

This content was produced with the assistance of AI translation services.