Guangzhou, the third largest city in China, has much lower average prices per square meter ($6,218) than Beijing ($7,974) and Shanghai ($9,671). But that could change as the southern metropolis has seen far stronger price growth in its luxury property market in the past year, beating out other major capitals around the world, according to The Greater China Quarterly Report Q4 by Knight Frank. Luxury residential sales in Guangzhou were up 78.9 percent quarter on quarter.
Although the Chinese government has imposed measures to cool the Chinese property market amidst fears of a bubble, luxury property prices in Guangzhou are likely to remain stable or even increase slightly, the report said. Guangzhou is already a huge economic engine for China, and new developments suggest it is likely to remain a good choice for luxury property investment.
Smart Manufacturing, Biotech, and the New Bay Area
Historically, Guangzhou has been an important finance and trade center. The city is home to the China Import and Export Fair (中国进出口商品交易会, also known as the Canton Fair), which is the largest trade fair in China. Guangzhou is also a leader in China’s manufacture industry, with the headquarters of P&G (宝洁), Ehang (亿航无人机), a Chinese tech company focused on drones, and Pony.ai (小马智行), a Chinese tech company focused on driverless cars.
The city also has a strong Internet business presence, with the headquarters of companies such as NetEase, Vipshop, UCWeb, YY Inc., and is becoming known for its biopharmaceutical industry, with GE Healthcare building a campus in Guangzhou Knowledge City, a 45-minute ride away from downtown.
Guangzhou also aims to build a Guangzhou-Hong Kong-Macau Greater Bay Area, which is modeled on San Francisco’s Bay Area and Silicon Valley in the United States. Guangzhou’s Bay Area will offer incentives to foreign companies to help it become a center for technological innovation.
Guangzhou is already filled with entrepreneurs and nontraditional start-ups, and the cost-of-living differential between Guangzhou and other top-tier Asian cities (such as Shanghai and Hong Kong) will likely drive more talents to move here and, ultimately, invest in luxury property.