Mainland China homes extend price rise

Cost of new flats grows at a slower pacein June, continuing an upward trend despite government measures to cool the market

PUBLISHED : Tuesday, 02 July, 2013, 12:00am
UPDATED : Tuesday, 02 July, 2013, 3:12am

Prices of new homes on the mainland continued to rise last month but at a slower pace, surveys by two leading property data providers found.

In a survey of 100 cities, prices rose an average 0.77 per cent last month from May to 10,258 yuan (HK$12,970) per square metre, said SouFun, the mainland's biggest real estate website.

"The growth was 0.04 percentage point smaller than the increment achieved in May," SouFun said.

Still, it was the 13th monthly increase since June last year, it said.

Seventy-one cities reported higher prices on the month, while the rest reported a drop, SouFun said.

Prices increased 7.4 per cent from June last year.

A similar trend was shown in another survey conducted by research firm China Real Estate Information Corp (Cric).

Prices of new homes in 288 cities surveyed rose an average 0.39 per cent last month, 0.48 percentage point lower than the increase in May.

Prices rose in 209 cities but fell in the other 79 surveyed, CRIC said.

In Beijing, prices rose 1.98 per cent from May, while in Shanghai they increased 1.53 per cent.

In Guangzhou, prices climbed 1.06 per cent on the month, but in Shenzhen, they remained practically flat, edging up just 0.03 per cent, Cric said.

In the secondary market, prices in 60 cities it surveyed rose an average 0.28 per cent last month from May.

Forty-four cities reported higher prices, the data provider said.

The research firm said prices continued to defy the central government's series of measures aimed at curbing the runaway housing market.

But it did not expect the central government to impose tougher measures, in view of the slowing economic growth.

The central government has set a target of 7.5 per cent economic growth this year, after growth of 7.8 per cent last year.

Last month, the World Bank trimmed its forecast for China's growth this year to 7.7 per cent from 8.4 per cent.

Barclays Capital lowered its gross domestic product growth forecast for the year last month to 7.4 per cent from 7.9 per cent, saying it believed China's new leaders had a greater tolerance for slower growth.

SouFun said in a discussion of its survey findings that transactions in both new and existing homes had stabilised recently in many cities, reflecting strong continuing demand.