China’s new home prices drop faster as analysts turn ‘negative’ on property-sector outlook amid ‘not enough’ stimulus

New home prices in 70 medium and large cities fell 0.3 per cent month on month in August after a 0.2 per cent drop in July, official data showed

Easing measures may only lead to an ‘L-shaped’ recovery in the sector in coming years, Goldman Sachs says

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Residential buildings at the City Plaza project in Beijing, developed by China Evergrande Group, pictured on August 18, 2023. Photo: Bloomberg

Published: 1:31pm, 15 Sep 2023Updated: 5:21pm, 15 Sep 2023

New home prices in Chinese cities fell at faster pace in August than in July, according to official data released on Friday, as the gloomy outlook for the housing market persists despite government stimulus measures, analysts said.

Prices for new homes in 70 medium and large-sized cities fell 0.3 per cent month on month in August after a 0.2 per cent drop in July, data released by the National Bureau of Statistics showed.

Only 17 of the 70 Chinese cities tracked saw price increases last month, compared with 20 in July, while prices of lived-in homes rose in three cities, versus six in July.

“The overall momentum of growth is weak, and the overall confidence of the industry needs to be further repaired,” said Zhang Bo, chief analyst at 58 Anjuke Real Estate Research Institute in Shanghai.

Residential buildings under construction at the Tao Yuan Tian Jing project, developed by China Evergrande Group, in Yangzhou, China, on September 7, 2023. Photo: Bloomberg

Among major cities, Beijing, Shenzhen and Guangzhou recorded month-on-month price declines ranging from 0.2 per cent to 0.6 per cent for new homes in August, while Shanghai’s new home prices increased 0.1 per cent over the same period.