BEIJING (Reuters) - China has this year invested 820 billion yuan ($129 billion) in 6.5 million public home building starts as of the end of August, the Ministry of Housing and Urban-Rural Development said, putting it on track to achieve an ambitious construction target.
Construction of affordable housing is a crucial part of China’s spending this year, and its importance is heightened as China’s cooling trade sector forces the country to fall back on state investment to drive growth.
China aims to start building 7 million such homes and complete construction of 5 million in 2012, compared with actual starts of 10.4 million units and completion of 4.3 million in 2011.
The ministry added that China finished building 4.2 million units as of the end of August.
Faster construction of public homes drove annual growth in China’s real estate investment up by 17 percent in August, from July’s 9.6 percent rise.
China’s real estate sector directly affects more than 40 other industries, from steel to furniture, and its investment accounted for 14 percent of gross domestic product in the first half this year.
Still, faster real estate investment has failed to counter weakening growth in the world’s No. 2 economy. Dismal economic data from trade to factory output in the past two days has raised expectations for further stimulus and monetary easing.
Reporting by Langi Chiang and Koh Gui Qing; Editing by Nick Macfie