Growth in China's new home prices slowed in November as markets in smaller cities lost some of their heat, though the sector remained relatively resilient amid a broader slowdown in economic activity. Average new home prices in China's 70 major cities rose 0.9 percent in November from a month earlier, slower than the previous month's 1 percent and the weakest since September, Reuters calculations based on an official survey showed on Saturday.
The data marks the 43rd straight month of price increases, Reuters calculation showed, a log trend that's remained intact despite curbs designed to rein in a near-three year real estate boom that has spread from megacities to the hinterland.
In a sign strength remains broad-based, 63 out of the 70 cities surveyed by the National Bureau of Statistics (NBS) reported monthly price increases for new homes, slightly lower than 65 in October. Compared with a year earlier, new home prices rose 9.3 percent, the fastest since July 2017 and quickening from October's 8.6 percent gain, according to data issued by the NBS.
A Reuters poll this week showed property investment would slow to 4 percent in 2019, while housing sales are expected to fall 5 percent amid slowing economic activity and tough financing conditions for smaller developers. China's four biggest cities of Beijing, Shanghai, Shenzhen and Guangzhou posted 0.3 in their average monthly prices.
The northern city of Hohhot was the top performer, rising 2.9 percent from October, NBS data showed. While solid growth in the sector could cushion the impact of a long government crackdown on debt and simmering trade tensions, policymakers worry it could stoke fears of a sudden crash if prices climb too quickly given elevated levels of household debt.
China's property market has remained relatively resilient as many investors exploit regulatory loopholes and turn to smaller cities where restrictions are lighter. Some speculators are also betting that many local governments, which rely on revenue from real estate, will be reluctant to tighten the regulatory screws too stringently.
In contrast, China's November retail sales grew at their weakest pace since 2003 and industrial output rose the least in nearly three years as the economy lost momentum amid the heated trade dispute between Beijing and the United States. Property investment in China picked up in November, a sharp contrast to other parts of the economy, which have weakened. However, recent soft home sales and land purchases suggest a dim outlook for the sector.
November sales by floor area were 5.1 percent lower than a year earlier, according to Reuters calculations. Household loans, mostly mortgages, increased to 656 billion yuan in November from 563.6 billion yuan in October, central bank data showed.
Comments
Comments are closed.