01 May 2014

China property inflation eases

  01 May 2014

BEIJING: Chinese home prices rose at a slower pace in April, two private surveys showed, adding to signs of cooling in the country’s property market.

Prices of new homes in 288 major cities rose 6.9% in April compared with the same month a year earlier, easing from a rise of 8.1% in March, a poll by real estate services firm EHouse China showed.

That was the slowest rise in 14 months and marked the sixth consecutive month of slowing price rises.

A separate survey by China Real Estate Index System (CREIS) showed average prices in the 100 biggest cities rose 0.1% month-on-month in April, versus March’s 0.4% rise, still the 23rd straight month of gains.

Compared with a year earlier, home prices rose 9.1% in April, moderating from a 10% gain in March and marking the fourth consecutive month of slowing year-on-year gains, CREIS said.

“The slowing broader economy, tighter credit conditions for the industry, plus rising expectations that local governments would loosen property controls have combined to dampen home price growth in April,” said CREIS, a consultancy linked to China’s largest online property information firm,Soufun Holdings.

Official media reported on Tuesday that the city of Nanning, in China’s southern Guangxi province, has eased rules on house buying as it looks to boost the local economy, raising speculation this could be the start of a series of local level support measures.

China’s property market has lost steam since late 2013 as authorities tightened controls on speculative buying, and as banks made it harder for home buyers and small developers to get loans.

Analysts believe that China’s property market could be one threat to Beijing’s plan to manage a slowdown in growth, as evidence mounts of a rapid cooling in what had been one of the few strong spots in the world’s second-largest economy.

Official figures showed China’s home price rises slowed to an eight-month low in March as some developers started to cut prices.

China’s statistical bureau is due to publish official home price data for 70 major cities for April on May 18. — Reuters


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