Expert predicts Shanghai, Beijing's housing prices to drop 50 pct, 30 pct

Shanghai and Beijing's housing prices will drop 50 percent and 30 percent respectively, said Yi Xianrong, an expert with the Finance Institute of the Chinese Academy of Social Sciences, in an article published in the 21st Century Economic Herald newspaper on Wednesday.

Since China promulgated a series of new policies to stabilize prices of commercial houses in May, many cities along the Yangtze River delta including Shanghai will be affected, Yi said.

"It is certain that house prices in these cities will slump because house prices there had risen to a high level," he said.

In contrast, places like Guangzhou, capital of south China's Guangdong Province, will be slightly influenced because there had been no sharp rises in the prices of commercial houses in the region, he said.

Last month, seven major government ministries jointly issued new housing policies in an attempt to stabilize housing prices. By using taxes and other leverage mechanisms, the new policies discourage speculation and ensure the supply of affordable housing.

Source: Xinhua