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China’s housing demand to stay resilient through 2030 despite short-term volatility - Fitch

According to a Fitch Ratings report released on Monday, China’s property market will remain relatively resilient over the next 15 years through 2030. Fitch study claims China’s housing demand will remain underpinned by residents who need new homes as their families grow, or from those moving from the country to live in cities.

Fitch estimates the demand to be 12 billion square meters from 2016-2030. It said China needs to build 800 million square meters of residential-property space per year, the size of Singapore, between 2016 and 2030 to meet demand.

It said more than 90 percent of which would have be met by commodity homes built by property developers, as affordable housing built by the state fails to keep up. The volume of new commodity homes to be sold and completed will fall, but the magnitude of the decline is likely to be modest on an annualized basis, Fitch adds.

The bullish outlook is in contrast with some recent domestic projections that claim China's housing sales had already peaked in 2013, and that demand will fall along with demographic changes, the slowing pace of urbanization, and as unsold housing stocks pile up.

The Reserve Bank of Australia also has expressed concern about the recent rebound in China’s residential property market, suggesting that there are growing doubts “about the sustainability of the recovery, particularly for investment”.

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