MNI China Press Digest May 5:Land Sales, Property, Consumption

Highlights from Chinese press reports on Friday:

• Local government revenue from land sales was down 27% y/y in Q1, with Zhejiang and Guizhou province falling 40% and 30%, according to Yicai. Citing analysts, the drop reflects the slow recovery of the real estate sector – a strong driver of land sales in the country. A local official said the impact on local finance was significant, although corresponding expenses on demolition and re-housing of residents had also decreased. Experts said the government should introduce further measures to stabilise the real-estate sector in the short term and develop other revenue sources including property, and resources taxes in the long run.
• House sales during the May holiday were up 25% y/y but remained around 20% lower than comparable 2019 data, according to Yicai.com. The news outlet said demand fell due to a tourism surge. Market players noted released pent up demand in H2 2022 likely drove Q1 recovery and might not be sustainable. Analysts called for measures to restore long-term buyer confidence including optimised purchase restrictions and support for families with two or more children.
• Shenzhen has passed laws to re-introduce the operation of roadside stalls and street vendors in an effort to boost consumption in the city, according to Yicai. Authorities in Shenzhen are following similar developments in Shanghai, Beijing and Lanzhou, and the new rules will take effect from September 1. Yicai cites Beijing and Shanghai as having made trials, which regulated the orderly operation and dispersion of sellers. The number of stalls in Shanghai decreased from a recorded 47,000 in 2007 to 5,759 in 2022, the news outlet said.