SHENZHEN ranked the lowest among 30 major cities in China regarding the proportion of the city’s GDP represented by real estate investment last year, meaning the city’s economy had the lowest dependency on the real estate industry, according to sznews.com.

    The list showed that Shenzhen’s real estate investments last year accounted for 9 percent of its GDP, the lowest among 30 major cities in China. Shenzhen is the only city with a proportion lower than 10 percent, which is considered to be the reasonable level by real estate expert, Hu Zhigang.

    According to the report, the higher the proportion, the more a city’s economy is relying on the real estate industry.

    Sanya in Hainan Province, with real estate investment accounting for 86 percent of its GDP, topped the list, followed by Haikou, Zhengzhou, Xi’an and Guiyang.

    Most of the cities at the top of the list are second- and third-tier cities, which saw climbing home prices last year. After many first-tier cities introduced policies to tame the housing markets last year, a lot of investors and speculators put their money into second- and third-tier cities that were near big cities, which stimulated the property markets in those cities.

    However, on another list showing the proportion of a city’s real estate investment to its fixed asset investment, Shenzhen ranked eighth with a proportion of 43 percent.

    “The proportion shouldn’t be above 25 percent. If a city puts 40 to 50 percent of its fixed asset investment into the real estate industry, the city’s industrial structure is unhealthy and its development won’t be sustainable, which might result in a real estate bubble,” Hu said.

    The Guangdong Provincial Statistics Bureau said the average housing price in Shenzhen was 45,146 yuan (US$6,564) per square meter last year, the highest among all Guangdong cities.

    It’s also worth noting that China’s proportion of real estate investment to GDP was 13.79 percent last year. Although the proportion had been declining compared with 16 percent in 2013, every country with a proportion higher than 6 percent has encountered a real estate market meltdown since 1960. When Japan’s real estate bubble burst, its proportion was 9 percent.

    (Zhang Yang)