China’s new home prices rose at a slower pace last month from March, as sales were affected after developers were forced to shut their sales offices in many cities due to the nation’s worsening Covid-19 situation. The average new home price in 100 Chinese cities increased 0.02 per cent to 16,193 yuan (US$2,450) per square metre in April, easing from 0.03 per cent growth in March, according to data from China Index Academy, one of the country’s biggest independent real estate research firms. “Developers’ contracted sales have been significantly affected by the zero-Covid policy adopted by the Chinese government, forcing them to close showrooms,” said Raymond Cheng, head of China and Hong Kong research at CGS-CIMB Securities. With an increasing number of mainland cities including Shanghai , Jilin and Xian under lockdown at various times since mid-March because of rising Covid-19 cases, real estate agency China Real Estate Information Corporation (CRIC) forecast in a report on April 22 that contracted sales at China’s top 17 developers could fall by 60 per cent last month from a year earlier. Developers such as CIFI Holdings and Shimao Group Holdings , who have higher exposure in these cities, could see sales declining by 62 per cent and 76 per cent, respectively last month. The outlook for the property market remains weak as the Covid-19 situation has dampened home-buying desire, Cheng said, adding that developers’ moves to promote sales via online channels has not had the desired impact. However, property sales are likely to recover somewhat this month as the number of Covid-19 cases in Shanghai, Jilin and some other cities has started trending lower from mid-April. The weakening property sales could prompt more city governments to take more aggressive loosening measures in the coming months, Cheng said. Currently, close to 70 cities have rolled out easing policies to revive the ailing property market, which accounts for one-third of China’s economic growth, as developers struggle to drive up sales. Ganzhou in southern Jiangxi province lowered the mortgage rate to 5.2 per cent for first time homebuyers, and 5.35 per cent for the purchase of second homes from May 1. The city also instructed banks to approve mortgage loans within three months. “This indicates banks will be proactive in extending home loans to support the market,” said Yan Yuejin, director of the Shanghai-based E-house China Research and Development Institute. “The slowdown in price growth is reasonable. But developers are still under pressure to offer bigger discounts to drum up sales of new homes in coming months,” he said.