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September 19, 2015

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House prices rise but growth slows

MORE cities registered higher prices for new homes in August compared to July but overall the pace of growth in China’s major cities began to moderate, according to figures released by the National Bureau of Statistics yesterday.

Prices went up in 35 cities, four more than in July, the bureau, which tracks prices in 70 cities, said. Nine saw prices unchanged, while prices fell in the other 26.

Shenzhen in south China’s Guangdong Province continued to lead with a month-on-month growth of 5.2 percent. It was followed by rises of 1.6 percent in Shanghai, 1.3 percent in Beijing, 1.2 percent in Nanjing and 0.9 percent in Guangzhou.

“Despite an increase in the number of cities where home prices have risen month on month, the country’s four first-tier cities — Beijing, Shanghai, Guangzhou and Shenzhen — all saw decelerated price growth last month, leading to a slight slowdown in the overall pace of growth for the 70 cities,” said Liu Jianwei, a senior bureau statistician.

“Notably, new home prices in 70 cities rose an average 1.7 percent in August from the same time a year earlier, the first year-on-year rise registered since September 2014.”

Year-on-year growth

Across the country, nine cities saw year-on-year growth in home prices in August, six more than in July. The other 61 cities suffered declines.

Shenzhen, Shanghai, Beijing and Guangzhou were the top four gainers with prices rising 31.8 percent, 6.5 percent, 3.7 percent and 2 percent, respectively, from the same period a year ago.

In the existing home market, 43 cities posted price gains, four more than in July. Prices in 11 cities were flat in August while another 16 recorded declines, compared with 13 and 18, respectively, in the previous month.

Robust sentiment among home buyers, particularly in gateway and some large second-tier cities, continued to help the country’s property market regain strength, while a batch of stimulus measures, including interest rate cuts and a reduction in the minimum down payments for second home buyers borrowing from local housing provident funds, could boost sales in third and fourth-tier cities.

Sales of new residential properties, excluding government-funded affordable housing, jumped 18.7 percent year on year to 4.07 trillion yuan (US$638.3 billion) in the first eight months of this year. That compared with a 16.8 percent growth recorded in the first seven months, the bureau said earlier.

Despite rising home prices, China’s property investment continued to slow.

Real estate investment rose 3.5 percent year on year to 6.11 trillion yuan in the first eight months, with the growth rate 0.8 percentage points lower than that in the first seven months, the bureau said.

New housing construction stood at 951.82 million square meters in the period, plunging 16.8 percent from a year earlier.

Sales value of commercial housing in the period went up 15.3 percent year on year to 4.8 trillion yuan. The growth rate was 1.9 percentage points higher than that in the first seven months, indicating nascent signs of recovery in some cities.


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