Housing prices won’t fall after Olympics, history says

-By Shanshan Lu- 

The American housing price turmoil (click here to read more on U.S. housing price crash…)alarmed its major trading partner—China. In recent years, China’s housing price has been skyrocketing, partially ascribed to the upcoming Beijing Olympic Games. Many people take investment in real estate as the most lucrative deal. (read more on China’s housing price)

But the recent turbulence of American economy raised a little bit concern of what is going to happen in China. Is Beijing’s housing price going to tumble down after the 2008 Olympics?

It is less likely to happen and the housing price will still be rising, experts say.

When we look at the former Olympics host cities, we may have more confidence in Beijing’s housing price.

Greek housing prices rose dramatically during a period of 1995 to 2002, after Olympics in 1993. The growth rate is up to 65 per cent. Along the two main subway lines, the growth rate of the housing prices has reached as much as 110 per cent.

But the local residents didn’t really buy into the price. Three factors contributed to this. First off, Greece is not so much internationalized with foreign bureaus and offices. There were no such needs. Secondly, Greece is the country with huge land and few people. Over 80 per cent of the population owns private housing. Few people want new house.The private-owing system has existed for long in Greece. Some of the properties were handed down from older generation so it lacks motivation in land development. (more on Greece Olympics…)

After 1993’s Sydney Olympics, flooding investments prop up the housing price. In the following seven to eight years, the housing price of the city doubled. Many new immigrants turned to millionaires, thanks to the prosperous housing market. This growth had been lasting until the end of 2003, almost 10 years after the Olympics.