China’s home price rebound extends into March as central Wuhan city leads recovery after unprecedented relief measures
- New-home prices in first-tier cities rose 0.3 per cent from the previous month, compared with a 0.2 per cent month-on-month gain in February
- A broader recovery in the housing market may be on the horizon as Beijing is joining smaller cities in relaxing restrictions
A rebound in home prices in China’s 70 big cities extended into March, as industry sentiment continued to improve after unprecedented efforts by policymakers to stem a slump in housing sales.
New-home prices in Beijing, Shanghai and other first-tier cities rose 0.3 per cent from the previous month, compared with a 0.2 per cent month-on-month gain in February, while those of lived-in homes gained 0.5 per cent, extending a 0.7 per cent gain a month earlier, according to the data released by the National Bureau of Statistics on Saturday. Prices of newly built homes in tier-two cities from Hangzhou to Tianjin increased 0.6 per cent and second-hand houses in these regions registered a 0.3 per cent price gain, the data showed.
Weighted average prices of newly-built homes in the 70 cities tracked by the statistics bureau rose 4.6 per cent in March on a month-on-month basis, accelerating from a 3.7 per cent gain in February, according to Goldman Sachs.
China’s property industry, which is deemed too big to fall as it and linked sectors account for about a quarter of the nation’s economy, has been in recovery after Beijing took a slew of measures to bail out the sector, including scrapping restrictions on home purchases in some cities, cutting mortgage rates and loosening funding access to ease liquidity squeeze on developers.
Beijing’s “three red lines” policy to curtail the industry’s leveraged expansion, coupled with three years of Covid-19 lockdowns, has upended the sector, spurring an industry-wide liquidity crunch and a flurry of defaults on bond payments by real-estate developers.