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Decline in home prices moderates
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SIGNS of a rebound were seen in China’s home prices in November as monthly declines narrowed after the government eased buying curbs and cut interest rates, official data showed yesterday.
New home prices dropped last month in 67 cities out of the 70 major cities tracked by the government, the National Bureau of Statistics said.
In Shanghai, new home prices fell 0.3 percent month on month, narrowing from the 0.7 percent drop in October.
“The shift of mortgage policies by local governments as well as a central bank cut in interest rates have brought a positive effect to new home sales across the country,” said Liu Jianwei, the bureau’s senior statistician.
Local governments have eased house purchase restrictions to prevent a sharp slowdown in the sector to avoid jeopardizing the broader economy.
Meanwhile, the central bank last month lowered interest rates to cut financing costs.
These moves have fueled home sales, which rose 11.6 percent in November from a month ago to 809.6 billion yuan (US$130 billion), the highest level since the start of this year, according to the bureau.
New home prices in Hefei, Nanjing and Shenzhen were flat.
A total of 58 cities among the 70 major cities saw prices of pre-owned homes drop last month, compared with 64 in October.
Pre-owned home prices in four first-tier cities all rose monthly in November.
On an annual basis, new home prices fell in 68 of the 70 cities, down from 69 in October.
“House prices will continue to drop going into next year but the pace of decline will moderate, and we expect the government to again ease housing policies, with likely options to include lower mortgage rates, tax incentives and simpler down-payment requirement for a second mortgage,” said Zhu Haibin, chief economist at JPMorgan China.
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