Choosing Fuzhou as a Target Market
To keep up with the expanding population, the Government has to expand the area of the city for the growing population and for the incoming people (to include the floating people). The Government has decided to build more infrastructure. In 2010 there will be two additional bridges across the Ming River bringing the total bridges in Fuzhou to 10. Government now focuses on expanding the new area between the urban and other 6 counties, and they have already drawn out special policies specifically for this.
The price of real estate in China is continuing to increase. According to the official figure, it shows that the average price is about 2724/m2 (31.69 USD/ft2). Compared with last year's price, land has increased 12.9%. It is the highest growth rate since 1996. The price of a house is about 2480/m2 (28.61 USD/ ft2), reflecting a growth rate of 10.4%. The price for office space in a high rise is 6970/m2 (80.43 USD/ ft2), reflecting a growth rate of 32.3%. Retail business building space is about 4312/sq m (50.26 USD/ sq ft), reflecting a growth rate of 14.9%. It is evident that the price of real estate is escalating rapidly. When analyzed from the supply and demand, the figures have shown that from January to June 2004, real estate companies sold land for development in the amount of 95,600,000 sq m (23,628 acres, reflecting a growth rate of about 12.2%. It remained the same growth rate as 2003. The total land area used for newly constructed houses was 118,000,000 sq m (29,165 acres). The growth was 12.9% from last year. The difference in the growth rate from the previous year dropped 24.8. From these figures, it shows that the real estate in China is in a demand market.
According to the official figures, it shows that the total amount of real estate transactions is 35,319 increasing 67.23% from the previous year. The total value of the contracts was 12,742,000,000 USD, increasing 79.67%. The area of real estate in all the transactions was 4,131,400 sq m, increasing 59.28%.
The experts say there are 3 general reasons stipulating the real estate market growth.
- Government Policy: Now the non-locals can have the resident registration for the city if you buy a house in the city. Many non-local people try to get the resident registration by buying houses.
- Price Factor: Presently, the average price of housing in Fuzhou is 3196 RMB/sq m (37.24 USD/ sq ft). It increased 3.1% from last year. In comparison with other coastal cities, it is low and has a strong potential to increase in value. It is the best opportunity for investors to realize a profit.
- Educational System Factor: Each resident in the city has a registration in the city and now because of the educational system, the children can only attend a school in the area where they are registered. In the first half of the year, the total volume of housing transactions from non-local people was 14,042. The total dollar amount of contracts was approximately 5,525,000,000 USD. It increased approximately 20% from last year.