The downturn in home sales has begun to discourage overall investment in housing as real estate developers’ willingness to start new projects continued to weaken for the second month, 21st Century Business Herald reported.
From January to October, the indicator that measures new investment intention in the real estate sector recorded year-on-year growth of 34.2%, decelerating by 1.7 percentage points from the January-September period, according to data released by the National Development and Reform Commission.
At least 17 cities, including Guangzhou and Shenzhen, have recorded negative growth in new investment intention. Beijing and Shanghai are also below average growth for the nation.
Yan Yuejin, research director of the Shanghai E-House Real Estate Research Institute, said that middle and western regions are attracting more investment because of the low cost of land.
While the eastern housing market is experiencing a cooling down in sales, which has dampened the willingness of developers to invest.