Moody's maintains negative outlook on mainland China ahead of property data

A day before Beijing announces property sales figures for the first 10 months, ratings agency Moody's yesterday said it would maintain negative outlook on the mainland's property sector despite recent policy relaxations.

The agency said it expected contracted property sales nationwide to drop up to 5 per cent next year, which betters its previous prediction in May, when it downgraded the outlook for the real estate industry to "negative" from "stable".

The National Bureau of Statistics will announce property sales and investment data for the first 10 months today. In the first three quarters, residential property sales revenue fell 10.8 per cent from a year earlier.

Private data shows a recovery last month after some policy easing, including cheaper and easier mortgage loans as well as tax cuts in many cities.

However, there are doubts if the recovery will last as the industry enters a traditionally slack season in winter.

"Inventory levels will remain high and liquidity will remain tight for the broad industry," adding to challenges for developers to service the high levels of debt they had incurred to buy land for new projects, Moody's said.