July 11 – Industry experts are predicting that sales of residential houses in China’s southern city of Shenzhen may slip further to prices found 10 years ago.

During the first half of this year, housing prices decreased by 36 percent to an average of RMB11,014 per square meter compared to October’s RMB17,350 per square meter.

Of Shenzhen’s six districts, Bao’an reported the biggest drop in May, with the average housing price reaching RMB10,418 per square meter, down 7.3 percent from last month. In comparison, the average housing price in Longgang District decreased by fell only 2 percent during the same period to RMB8,910 per square meter.

New residential houses available amounted to almost 1.54 million square meters, a decrease of 54 percent from the previous year. In addition, 650,000 square meters still remain unsold, an increase of 84.5 percent.

“Based on current sales, we forecast that just about 3.5 million square meters of residential housing area will be sold this year,” Wang Feng, director of Shenzhen Real Estate Institute, told China Daily.

China’s recent mortgage policy restriction has affected the housing markets of Shenzhen, Shanghai and Beijing, where prices have been pushed by speculation.

Wang said that sliding real estate prices reflect global economic uncertainties and China’s own policy although he assures that the current slump would soon pass.