China new home prices manage tiny uptick again in September, private survey shows
2024.09.30 22:58
BEIJING (Reuters) – Prices of new homes in China rose slightly in September, traditionally a peak season for house hunting, a private survey showed on Tuesday, extending months of feeble gain in a crisis-hit market that has worried the country’s leaders.
The average price across 100 cities edged up 0.14%, compared with the previous month’s 0.11%, showed data released by property researcher China Index Academy.
Compared with a year earlier, the average price increased by 1.85%.
Of the 100 cities, 17 reported price gain, versus 35 in August, underscoring cautious buyer sentiment that has chilled the real estate market in recent years.
The market has been in a slump since 2021 after a string of cash-strapped developers defaulted on loans, leaving behind large inventories of new homes and unfinished projects.
Authorities have since lifted many home purchase restrictions imposed previously to deter speculators. They have also lowered mortgage rates and down payment requirements. Still, the easing has had limited effect on demand.
In the latest attempt to jump-start buying, the central bank last week unveiled a package of monetary stimulus, including a cut in the minimum down payment ratio to 15% across all categories of housing.
The southern metropolis of Guangzhou on Sunday became the first top-tier city to lift all restrictions on home purchases. Shanghai and Shenzhen said they would ease curbs on purchases by non-local buyers and would lower the minimum down payment ratio for first-home buyers.
Even so, the measures are not likely to be enough to prompt a market turnaround, economist Huang Zichun at Capital Economics wrote in a research note last week.
“The key to making a real difference is to provide greater fiscal funding for the purchase of unsold homes.”
The protracted market downturn has also eroded the wealth of households, which often count homes as their single largest investment, reining in domestic consumption.
To help households struggling to pay loans, regulators on Sunday ordered banks to lower interest rates on all existing mortgages by the end of October.
