Property buyers spurned but share investors rewarded at Xi’s new ‘dream city’
At least seven detained, sales offices and property agencies closed to stabilise proposed new area’s housing market
At least seven people have been detained, 71 sales offices for property projects closed, and 35 real estate agency shops shut down in the region of the Xiongan New Area in the last four days to clamp down on property speculation.
Meanwhile, more than 40 stocks based in the zone or nearby regions jumped by the daily 10 per cent limit on the A-share markets on Wednesday morning, amid expectations of government stimulus to build up the new district, which was envisioned by Chinese President Xi Jinping as the future model of China’s development.
Property, cement, energy and port companies in the northern provinces led the gains, on the first trading day after Chinese authorities on Saturday unexpectedly unveiled the plan to build a new economic zone only about 120km south of Beijing.
Shares of Shanghai-listed property developer China Fortune Land Development, which has land holdings in Xiongan, rose by the 10 per cent limit to 29.99 yuan, their highest level since January 2016.
Beijing-based cement maker BBMG Corp also saw its A shares close 10 per cent higher at 5.1 yuan on Wednesday, following a 35 per cent surge of its Hong Kong shares on Monday. Tangshan Jidong Cement and Tianjin Port also hit the daily price rise ceiling.
At the same time, the local authorities are trying hard to fend off property speculators.
China’s sudden announcement on Saturday that it was creating a new economic district in the backwater zone of Hebei to rival Shenzhen and Shanghai’s Pudong kindled investment enthusiasm for property in the area.
