China’s home price growth cools for the sixth month since October

Home price growth in China cooled in May, the sixth month since last October, when Beijing started to tighten the sizzling property market.

The data is the latest evidence that tougher market restrictions introduced by local governments since March continued to bite, especially in bigger cities. Sequential price growth have slowed every month except for February and March, when there was a brief uptick.

New home prices rose on a monthly basis in 56 of 70 cities tracked by the government, compared with 58 in April, the National Bureau of Statistics said on Monday.

There were prices gains in six of the 15 first- and second-tier cities closely monitored by the NBS, unchanged from April.

Shenzhen led the declines with a 0.6 per cent contraction in May compared with April, while prices in Hangzhou fell 0.3 per cent. Home prices in both Beijing and Shanghai were flat compared with the previous month.

In Beijing, which has seen the nation’s tightest property restrictions, prices of existing homes fell by 0.9 per cent, the first decline since February 2015. Transactions for existing homes account for four fifths of the city’s total sales and are more sensitive to market changes.