Property

In western countries you can buy a piece of land with a house on it and it will be your property until you decide you want to sell it. It is not possible that someone takes possession of your home without paying for it. Even the government has to pay for your possession if they want the ownership of it.

In China it is not possible as a private person to buy a house or land for eternity. Ownership is limited. Most of the time you can only lease your home or land, this is called ground lease.
A national land register is not available in China. This makes it even more difficult to find out who has the ownership of a piece of land.
You don’t own your house and this makes it easier for the government to disown people. Compensations from the government are often very little, due to the lack of independent jurisdiction civilians have no way to go with their complaints.

Prices could be cut in half in the upcoming year

For ten years the real estate market was the driving force of China’s economical success. But according to the annual report Real Estate 2009, written by the Chinese Academy of Social Sciences (Cass), the sales for 2008 broke down with 19.7 per cent.

Last year the vacancy of homes in China went up till 164 million m2, which is 21 per cent more then in 2007. The report predicts an increase of sales for later this year. This is due to the deduction that developers have to give to receive cash.
Researcher Cao Jianhai of Cass predicts a decline for the housing prices of 50 per cent for the upcoming year.
Local government purchased 40 per cent less land for housing in the first quarter of this year.

The government reduced the interest rate, banks are allowed to give more credit and the down payment is reduced for home buyers.

Real estate

The (growing) middle class and the top layer of the Chinese society buys nowadays, partially as an investment, a substantial amount of apartments and houses without the use of grants.
The private purchase of houses has risen enormously, mostly because of the attractive loans of the large national banks. Considering the strong increase of the urbanisation it is likely that the demand for residences will rise in the urban areas in China.
Between 2000 and 2007 the investments in real estate have risen with 20% per year. Since the end of 2007 the market segment is confronted with relapsing prices and transaction volumes. This trend is accumulated by the economic crisis.
It is expected that the situation will improve due to the action plan from the Chinese government.