Sellers of homes renege on transactions, banking on further hikes in prices

Hong Kong

WOULD-BE sellers of homes in China's southern city of Shenzhen are tearing up signed sales contracts in anticipation that prices there will continue to surge, the country's largest property agency said, fuelling fears of overheating in the top-tier city.

Home prices in Shenzhen are set to post a second consecutive annual rise in May data out on Thursday, helped by scarce land supply, favourable policies towards local enterprises, and a stockmarket rally that has seen the Shenzhen index more than double this year.