Home prices tumble for another month on mainland

Home prices on the mainland continued to fall last month, but analysts said it was too early to judge whether the downward correction would be sustained and expected government restrictions on purchases to remain.

Prices declined last month in 49 of the 70 large and medium-sized cities tracked by the government, the National Bureau of Statistics said. That is up from declines in 34 reporting areas in October an 14 that saw price declines in the third quarter.

The secondary market also headed lower, with 51 cities witnessing price declines, up from 38 in October and 22 to 26 in the third quarter.

Year on year, prices were down in only four cities last month for new homes, compared to 21 cities that reported year-on-year price falls for existing homes, the bureau said. The four cities included Wenzhou, whose entrepreneurs are notorious for speculating on properties, and where November's average sales price for new homes was down 5.2 per cent on the same month last year.

Prices in Haikou in Hainan province, Nanchong in Sichuan province, and Ningbo in Jiangsu province, were less than 1 per cent lower year on year.

'I don't think restrictive policy will change in the short term since Beijing said after last week's Central Economic Work Conference that it will continue to regulate property prices next year,' said UBS economist Wang Tao. 'The price decline has just started. By next year over half the cities will see year-on-year declines.'