Chinese state bank chief warns against buying property now ‘because there’s no money to be made’
- China Construction Bank chairman suggests market may not rise much further and warns that investors may become ‘trapped’
The chairman of a leading Chinese state bank on Sunday warned Chinese investors not to buy property now because “there’s no money to be made” due to high prices and alarming vacancy rates.
Tian Guoli, the chairman of China Construction Bank, which provides mortgage loans to millions of Chinese households, said that the room for further property price rises was limited and it was unwise to buy at current rates, according to the portal Sina.com.
“There’s no money to be made if you buy a flat nowadays. If you insist on buying a home, aren’t you trapped at the high price level?” Tian told a forum organised by Peking University’s Guanghua school of management.
The warning by Tian, who is an alternate member of the Communist Party Central Committee, came at a time when the country is in heated debate about the role of the property market – whether it will lead to an bust or whether it can help shore up the economy.
At the recently concluded Central Economic Work Conference, the top leadership promised to build a long-term mechanism for the property market, on the basis that “property is for living, not for speculation”, adding that regulations would vary from city to city.