China’s new home prices in February rose slightly on month after a dip in January, mainly driven by higher prices in the Pearl River Delta and Yangtze River Delta regions, data released by a private-sector research firm showed on Tuesday.
New home prices in 100 cities grew 0.03% from a month earlier in February, following a 0.01% drop in January, according to data from China Index Academy, one of the country’s largest independent real estate research firms.
China’s property market gained strength in recent weeks after a deep downturn last year as authorities began easing regulations, including allowing smaller down payments, lowering mortgage rates and cutting the deed tax.
Real estate firms are gaining easier access to presale funds from residential projects, a move by authorities to ease the industry’s severe crash crunch, according to media reports last month.
Guangzhou, the capital of southern Guangdong province in the Pearl River Delta, recorded the biggest monthly increase of 0.62% in new home prices among 100 cities last month.
Shanghai, located in the eastern Yangtze River Delta, rose 0.23% from the previous month, outstripping the city of Beijing’s 0.02% increase.
China’s parliamentary meetings will be held later this week, and more local policies based on local conditions are expected to roll out to stabilise the property market after the meetings, said Cao Jingjing, research director of China Index Academy.
Some local governments may relax restrictions on home purchases to boost genuine demand, Cao added.
However, the momentum for the property market remained soft last month, just 30 of 100 cities reported new home prices rose, less than 44 in January.
Overall transaction volumes were small in February with the number of new projects falling sharply in key cities during the week-long Lunar New Year holidays, Cao said.
“The property market is expected to see gains in March in first- and some second-tier cities,” Cao added.
- Reuters with additional editing by Jim Pollard
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