Image: Reuters Berita 24 English - China's new home prices declined for the second month in a row in May, according to official statist...
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| Image: Reuters |
Berita 24 English - China's new home prices declined for the second month in a row in May, according to official statistics released on Thursday, weighed down by continued shaky demand as broad COVID-19 restrictions eroded already shaky buyer trust in the market.
According to Reuters calculations based on National Bureau of Statistics (NBS) data, average new-home prices in 70 major cities declined 0.1 percent month over month in May, following a 0.2 percent drop in April.
Prices fell 0.1 percent from a year ago, falling for the first time since September 2015 and reversing a 0.7 percent gain in April.
Due to a slowing economy, restrictive mortgage disbursement, and reduced mood amid a liquidity crisis that resulted in some high-profile developer loan defaults, new home price growth has slowed since May of last year.
In recent months, China's property sector, which has been a pillar of growth, has deteriorated even further. Authorities are working to boost housing demand in some of the country's most populous cities, which has been stifled by COVID-19 restrictions.
More than 100 localities announced relaxing measures in May to boost the real estate sector, primarily aimed at home purchasers, such as lower mortgage rates, smaller down payments, and buying restrictions for some buyers.
On May 22, the central city of Wuhan lifted home purchase restrictions for some buyers, enabling families with more than one child to acquire up to three homes.
In May, 25 of the 70 cities examined by the National Bureau of Statistics reported an increase in new home prices from the previous month, compared to 18 cities in April.
According to a recent Reuters poll, China's property market difficulties are set to intensify this year, with prices remaining flat and sales and investment plunging even more.
For the first time in three months, property sales by floor area decreased in May.
Last month, the Federal Reserve dropped its benchmark rate for mortgages and decreased the mortgage rate floor for first-time home buyers in an effort to increase demand.
In the next months, more softening policies aimed at helping demand are expected to stimulate the sector.
