House price slump in China shows no sign of abating as more cities record falls in December
- New home prices fell 0.25 per cent in December, while the fall in lived-in home prices was steeper at 0.5 per cent, according to National Bureau of Statistics
- The number of Chinese cities that saw a fall in home prices rose to 55 in December, from 51 in November
China’s new home prices fell for the 16th consecutive month in December, easing by 0.25 per cent, with analysts forecasting persistent weakness in the nation’s residential property market for the foreseeable future.
Of the 70 large and medium-sized cities tracked in the mainland, 55 recorded a decline in home prices, an increase of four compared with the previous month, according to data from the National Bureau of Statistics on Monday. In the secondary housing market, prices retreated in 63 cities, up from 62 in November.
The pace of decline in new home prices was the same in November, though lived-in homes saw a deeper fall. Secondary home prices fell 0.5 per cent, compared with 0.4 per cent in November.
China’s property market, until recently, had been hobbled by both Beijing’s crackdown on unfettered borrowing by property companies and its strict zero-Covid policy.
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With Covid restrictions largely eased since last month and measures such as encouraging banks to lend to developers and relaxing down payment requirements for homebuyers to support the ailing sector, the housing market is likely to see a gradual upswing, according to analysts.
“The reopening [of China] will have a limited impact on property prices in China as most of the demand is domestic,” said Martin Wong, director and head of research and consultancy for Greater China at Knight Frank. “That said, it will lead to higher transaction volume as the reopening would lead to an improvement in market confidence.”