BEIJING: China’s real estate market remained anemic with new home prices in April registering month-on-month declines in most of surveyed cities.
Of 70 large and medium-sized cities surveyed, new home prices dipped in 48 in April from the previous month, according to data released by the National Bureau of Statistics (NBS) on Monday.
New home prices were flat in Shenyang, Hefei, Jinan and Changsha, while 18 cities including Beijing, Shanghai, Guangzhou and Shenzhen saw prices inch up from March, the NBS data showed.
For existing homes, 34 cities saw price declines in April on a monthly basis, eight reported flat prices, while 28 cities posted gains, 16 more than last month.
Amid a cooling real estate market and shrinking exports due to uneven global economic recovery, economic growth in the world’s second-largest economy slid to 7 percent in the first quarter, marking the lowest quarterly growth rate since 2009.
To offset the downward pressure in the economy and reduce financing costs for companies, the central bank has cut the benchmark interest rate three times since November. It has also dropped banks’ reserve requirement ratio twice since February.
On the back of the policy support, home sales in some major cities have gradually recovered, but in less developed areas where inventories remained high, the effect of the policy seemed muted.
According to NBS calculations, the average home price in top-tier cities increased 1 percent in April on a monthly basis, whereas those in second- and third-tied cities declined 0.1 percent and 0.3 percent, respectively.
The rate of decline in Chinese home prices slowed in March from February, two private surveys showed on Wednesday, adding to hopes the housing market is stabilizing as Beijing enacts policies to bolster economy.
Prices of new homes in 288 cities fell 0.01 percent in March, the 12th consecutive drop on a monthly basis, a poll by property services provider Real Estate Information Corporation (CRIC) showed. The drop slowed from a 0.06 percent decline in February.
But home prices were 1.71 percent lower compared to a year ago, from 1.62 percent in the previous month.
“The index has been falling for one year, but the monthly drop has been narrowing for four months,” said CRIC, owned by E-House China Holdings Ltd.
China on Monday lured potential home buyers with a bigger tax break as it cut downpayment requirements for the second time in six months, stepping up a fight against sliding house prices that are imperilling the world’s second-biggest economy.
The central bank cut interest rates in November and February and lowered bank reserve requirements to encourage lending. More cuts are expected in coming months as Beijing works to meet a growth forecast of 7 percent this year.
But as stock market investors cheer China’s latest bid to boost an ailing housing sector, bankers are gritting their teeth over the risks they face in further relaxing rules on lending to home buyers.
A separate survey by China Real Estate Index System (CREIS) showed average prices in 100 of the biggest cities fell 0.15 percent in March on-month, also narrowing from a 0.24 percent fall in February.
Compared with a year ago, home prices dropped 4.35 percent, the sixth consecutive month showing an annual fall, compared to 3.84 percent fall in the previous month, said CREIS, a consultancy linked to China’s largest property data provider, Soufun Holdings.
China Vanke Co Ltd, China’s top property developer, said on Tuesday land prices in China have not yet returned to reasonable levels, suggesting limited demand.
The government is due to publish its March property price data for 70 of the biggest Chinese cities on April 18 after reporting its property sales and investment figures on April 15.
