China home prices climb for 14th month

By Cherry Cao | August 1, 2013, Thursday |

Online Edition

Home prices in China climbed for another month in July, extending strength for the 14th straight month.

The average price of new houses in 100 Chinese cities rose 0.87 percent from June to 10,347 yuan (US$1,688) per square meter, the China Index Academy said today. That compared with June’s growth of 0.77 percent.

The number of cities that registered monthly price rises fell further to 61 last month, compared with 71 in June and 77 in May. Of those, 23 cities saw growth of more than 1 percent, seven more than that in June. Quanzhou in southeast China’s Fujian Province led last month's gainers with a 4.45 percent rise.

There were price drops in 39 cities, with Dongguan in Guangdong Province suffering the biggest decline of 1.71 percent.

In the 10 largest cities, the average price of a new home climbed 1.34 percent to 17,609 yuan per square meter, accelerating from June's growth of 1.01 percent. Among them, Beijing saw the biggest rise of 2.5 percent, immediately trailed by 2.13 percent in Guangzhou. In Shenzhen and Shanghai, new home prices rose by 1.24 percent and 0.85 percent, respectively, the academy said.

"Growing uncertainties of economic growth, somewhat alleviated expectations for further tightening measures from the central government, as well as continuously stable demand from homebuyers, jointly contributed to a faster pace in July," the academy said.

"Nationwide, we have been seeing even more mixed pictures in different cities with those with high prices registering even faster growth and real estate developers showing increasing interest in land reserve expansions in the first- and second-tier cities."

In Shanghai, new home sales fell to a five-month low in July with the average price reaching a historic high, according to a separate industry report released today.

The purchases of new residential properties, excluding government-subsidized affordable housing, dropped 31 percent to 777,000 square meters last month, the lowest volume since March, data released by Shanghai Deovolente Realty Co showed.

The average cost of new homes, however, climbed 3 percent from June to 24,687 yuan a square meter last month, an all-time high in the city.

"The scorching weather in July has damped buyers' sentiment while real estate developers also seemed less inclined to release homes for sale during the traditional sluggish season for property purchase," said Lu Qilin, a Deovolente researcher. "However, robust sales of mid- to high-end homes, coupled with price hikes at some residential developments, finally helped push the average price to a record high."

New homes costing more than 30,000 yuan per square meter accounted for almost a quarter of the city's total transaction last month, Deovolente data showed.

For the rest months of this year, industry analysts predicted that home prices should extend their momentum amid continuously solid demand from home seekers.

"Despite the retreat in July, I expect the city's overall housing market to remain robust in the second half of this year," said Huang Zhijian, chief analyst at Shanghai Uwin Real Estate Information Services Co.

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China home prices climb for 14th month

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