Shenzhen-Dongguan metro link may shrink demand for Shenzhen property
An upcoming metro link between Shenzhen and the neighbouring city of Dongguan will further drive up Dongguan's home prices and may serve as an alternative for home buyers in Shenzhen who cannot afford the city’s soaring property prices. Meantime, property prices in Dongguan have already risen considerably since last year, ahead of the metrolink announcement. Song Ding, director of the Tourism and Real Estate Industry Research Center at a Shenzhen-based think-tank, said that, "The metro link is not expected to divert buyers from Shenzhen to Dongguan, but may spur fresh buying demand from those who had no plans previously to buy homes because of surging prices”.

Shenzhen-Dongguan metro link may offer homes relief for workers Updated: 2015-09-23 09:14 By Zhou Mo in Shenzhen(HK Edition)

An upcoming metro link between Shenzhen and the neighboring city of Dongguan may come as a boon for Shenzhen's working class who has long been distressed by the city's skyrocketing property prices.

They will have another option - setting up homes in Dongguan, which is located just 90 kilometers north of Shenzhen, with both cities already well connected by high-speed rail.

According to an announcement on the official website of Shenzhen Municipality's Transport Commission on Sept 8, four Shenzhen metro lines, including No 11 and No 6, which are under construction, and the planned No 12 and No 18 lines, will link up with three routes in Dongguan.

But, it's not known when the intercity projects will come into operation.

Song Ding, director of the Tourism and Real Estate Industry Research Center at Shenzhen-based think-tank, the China Development Institute, believes that the metro link between the two cities will further drive up Dongguan's home prices.

"Property prices in Dongguan have already risen considerably since last year, ahead of the metro link announcement," he said.

Song said the new transport link will stimulate demand from people in Shenzhen who cannot afford to buy properties in the metropolis, but will exert little influence on the city's housing market itself.

"The metro link is not expected to divert buyers from Shenzhen to Dongguan, but may spur fresh buying demand from those who had no plans previously to buy homes because of surging prices," he added.

According to Centaline Property Agency data, average real estate prices in Dongguan reached 9,551 yuan ($1,498) per square meter in the year up to August, with 64.3 percent of the apartment prices rising on a monthly basis in August, while 21.4 percent surged by more than 5 percent.

In areas adjacent to Shenzhen, the growth was even stronger.

Some residential projects in the Shenzhen-Dongguan border area of Fenggang saw prices climb by almost 7,000 yuan per square meter from May to August this year, hitting nearly 20,000 yuan per square meter.

However, some workers in Shenzhen who intend to settle down in the city are not overly excited about the new metro link.

Dai Xin, 27, who works at a consultancy firm in Futian district, said although her office is located close to Shenzhen's No 11 metro line, which will be the underground link between the two cities, she's not prepared to set up home on the Dongguan side of the border.

"Undoubtedly, it will take less time to commute to and from work with the new link, but the distance is something that cannot be shortened. After all, Dongguan and Shenzhen are two different cities," she told China Daily.

"With plenty of options available in Shenzhen and home prices in the border areas with Dongguan rising rapidly, why should I choose to live there?"

After three months of rapid property price increases since the launch of new national housing policy in late March, Shenzhen's real estate market has seen signs of cooling down.

According to government statistics, average prices of new homes in Shenzhen fell by 12 percent to about 33,300 yuan per square meter from Sept 8 to 14, compared with the previous week, while the transaction volume saw a significant decline.

sally@chinadailyhk.com

With an upcoming metro link between Shenzhen and the neighboring city of Dongguan, Dongguan may serve as an alternative for home buyers in Shenzhen who cannot afford the city's soaring property prices. In the mean time, property prices in Dongguan have already risen considerably since last year, ahead of the metro link announcement, experts say. Provided to China Daily

(HK Edition 09/23/2015 page8)