Chinanews, Beijing, Oct. 26 - Chief economist on Chinese issue from J.P.Morgan Frank Gong said on Monday that over the next few years, Chinese economy would continue to grow with increasing momentum. Fortune accumulates rapidly and many foreign investors are still very optimistic about Chinese property market. At the same time, there is still a great potential for Renminbi to appreciate. Based on these factors, it is reasonable for real properties in China to raise their value by 10% every year.
In his speech at a real estate financial forum, Frank Gong said that the pressure on Renminbi appreciation was the result of inflation. He said that at present, when Renminbi was not making much gain in value and the consumer price index (CPI) was rising slowly, the inflation was shown by appreciation in the real estate market.
Apart from Renminbi appreciation factor, Gong noted that if China’s macro economy could grow at an annual rate of 10% over the next few years, then the 10% appreciation rate in the real estate market would be “reasonable and normal to the economic situation.”
He pointed out that over the past decade, Chinese people’s disposable income had grown at an annual rate of 10-11%, while price in property market risen by only 6% on average every year, far below the GDP growth rate and the growth rate of people's disposable income.
According to him, Chinese property market, on the whole, was in a healthy state in the past eight years.
“There are definitely no bubbles appearing in Chinese property market,” said Frank Gong, who predicted that over the next three years, Chinese property market would still remain a most ideal market for international investors.