Chinese investors see no let-up in the depression that has engulfed the country’s property market, according to an official survey that is sure to heap more misery onto beleaguered developers and homeowners. Just 14.8 per cent of respondents in a consumer survey by the People’s Bank of China believe home prices could rise in the fourth quarter of this year. The remaining 85.2 per cent are betting prices will either drop or stagnate . The quarterly survey, released on Sunday, was the latest sign that the real estate sector, one of the cornerstones of China’s economy, is almost entirely drained of confidence after Beijing’s austerity measures and Covid-19 pandemic curbs sent it into a nosedive. The previous survey, in the second quarter, found that 16.2 per cent respondents expected home prices to climb between July and September. “People are less confident in buying homes, and many potential buyers are taking a wait-and-see attitude,” said You Liangzhou, who owns Baonuo, a property agency in Shanghai. “Developers and homeowners may have to mark down prices to get their properties sold.” According to the China Index Academy, one of the mainland’s largest property consultancies, the number of new homes changing hands was surprisingly weak during the National Day holiday between October 1 and 7, which is normally a high season for property sales. Based on sales data from 21 cities, the transaction volume plunged 38 per cent from a year ago, with Hangzhou, the capital of East China’s Zhejiang province, diving 80 per cent, and Beijing’s witnessing a 60 per cent fall. In the secondary home market, landlords will have to offer a 5 to 10 per cent discount to lure potential buyers, despite government incentives to buoy the housing market, according to You. In late August, China’s central bank cut the five-year loan prime rate (LPR) by 15 basis points to 4.3 per cent, reducing borrowing costs for homebuyers. In Shanghai, the five-year mortgage rate for first-time buyers stands at 4.65 per cent, while buyers of second homes are charged an annualised interest rate of 5.36 per cent. Both rates have been reduced by 15 basis points. The average interest rate for first-time buyers in more than 100 Chinese cities monitored by the Beike Research Institute, a property think tank, had fallen to 4.19 per cent in September from 5.74 per cent a year ago. At the end of September, the Ministry of Finance announced that people who buy a new home within a year of selling their old one will get the capital gains tax on the sale refunded. The tax incentive, aimed at bolstering transactions, could save the buyer of a flat worth 10 million yuan (US$1.39 million) as much as 500,000 yuan in tax payments. China’s economy grew by 0.4 per cent in the second quarter, compared with a year earlier, as it struggled to shake off the impact of widespread lockdowns to contain the spread of Covid-19. Along with the fallout from Beijing’s strict zero-Covid policies, the slowdown in the mainland’s property sector has been a major factor in banks such as Nomura, Morgan Stanley and UBS cutting the country’s growth forecasts to less than 3 per cent for 2022 – much lower than the official target of 5.5 per cent. In August, 50 cities across the mainland saw new home prices drop, compared to 40 a month earlier, according to the National Bureau of Statistics. The number of cities that witnessed second-hand home price drop jumped to 56, five more than July.