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New home prices drop in 55 of 70 cities
By Cherry Cao |
June 18, 2012, Monday
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A RECORD number of Chinese cities registered a year-on-year decline in home values in May, according to the National Bureau of Statistics today.
Excluding government-subsidized affordable housing, prices fell last month in 55 of the 70 cities tracked by the bureau, compared to 46 cities that saw year-on-year declines in April. On a month-on-month basis, 43 cities witnessed drops in the price of new homes in May, while six gained and the rest were flat.
"The continuous rise in the number of cities recording year-on-year losses in home prices was because developers cut prices across the country over the past few months," said Sky Xue, an analyst with China Real Estate Information Corp. "However, while transactions of new residential properties also picked up accordingly, we expect to see the trend end soon, probably before the end of the third quarter, as the market is approaching its bottom. Some developers are already starting to raise prices amid improving sentiment."
Sales of new homes dropped 13.5 percent year on year to 255.52 million square meters across the country between January and May, compared to a 14.9 percent annual drop recorded during the first four months of this year, the statistics bureau said earlier this month. By value, they fell 10.6 percent to 1.4 trillion yuan (US$221 billion) from the same period a year earlier, compared to a yearly decline of 13.5 percent registered during the January-April period.
Nationwide, new home prices in Wenzhou, Zhejiang Province, dropped 15.1 percent from a year earlier and lost 1.9 percent from April, continuing to lead all decliners on both year-on-year and month-on-month basis.
In Shanghai, Beijing, Guangzhou and Shenzhen, where home purchase restrictions have been vigorously enforced, new home prices lost between 1.6 and 2.3 percent in May from a year earlier. That compared to a retreat of between 1.2 percent and 1.7 percent in April.
Month on month, the four cities lost strength for the eighth consecutive month, down in home value by between 0.1 percent and 0.3 percent, the bureau said.
For existing homes, prices fell in 58 cities last month from a year earlier, an increase of two from April. They were unchanged in one city while the remaining 11 saw gains of no more than 2.9 percent.
An earlier survey by the China Index Academy, which tracks 100 cities across the country, showed home prices fell by an average of 0.31 percent in May from a month earlier, extending weakness for the ninth straight month but narrowing from a dip of 0.34 percent in April.
Excluding government-subsidized affordable housing, prices fell last month in 55 of the 70 cities tracked by the bureau, compared to 46 cities that saw year-on-year declines in April. On a month-on-month basis, 43 cities witnessed drops in the price of new homes in May, while six gained and the rest were flat.
"The continuous rise in the number of cities recording year-on-year losses in home prices was because developers cut prices across the country over the past few months," said Sky Xue, an analyst with China Real Estate Information Corp. "However, while transactions of new residential properties also picked up accordingly, we expect to see the trend end soon, probably before the end of the third quarter, as the market is approaching its bottom. Some developers are already starting to raise prices amid improving sentiment."
Sales of new homes dropped 13.5 percent year on year to 255.52 million square meters across the country between January and May, compared to a 14.9 percent annual drop recorded during the first four months of this year, the statistics bureau said earlier this month. By value, they fell 10.6 percent to 1.4 trillion yuan (US$221 billion) from the same period a year earlier, compared to a yearly decline of 13.5 percent registered during the January-April period.
Nationwide, new home prices in Wenzhou, Zhejiang Province, dropped 15.1 percent from a year earlier and lost 1.9 percent from April, continuing to lead all decliners on both year-on-year and month-on-month basis.
In Shanghai, Beijing, Guangzhou and Shenzhen, where home purchase restrictions have been vigorously enforced, new home prices lost between 1.6 and 2.3 percent in May from a year earlier. That compared to a retreat of between 1.2 percent and 1.7 percent in April.
Month on month, the four cities lost strength for the eighth consecutive month, down in home value by between 0.1 percent and 0.3 percent, the bureau said.
For existing homes, prices fell in 58 cities last month from a year earlier, an increase of two from April. They were unchanged in one city while the remaining 11 saw gains of no more than 2.9 percent.
An earlier survey by the China Index Academy, which tracks 100 cities across the country, showed home prices fell by an average of 0.31 percent in May from a month earlier, extending weakness for the ninth straight month but narrowing from a dip of 0.34 percent in April.
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