Chinese home prices last month increased in the fewest cities in a year, signaling property curbs to deflate a potential housing bubble are taking effect.
New home prices, excluding government-subsidized housing, last month gained in 45 of the 70 cities tracked by the government, down from 46 in December last year, the Chinese National Bureau of Statistics said yesterday, adding that prices fell in 20 cities and were unchanged in five.
Chinese authorities have expanded curbs on home purchases and tightened restrictions on property lending in an attempt to avoid a housing bubble and reduce financial risks.
Some bank branches in Beijing, Guangzhou and Chongqing have raised mortgage rates for first-time buyers, people familiar with the matter said earlier this month.
New home prices in Shenzhen, the nation’s hottest market early last year, last month fell 0.5 percent from December, the fourth straight monthly decline, bureau data showed.
Prices in Shanghai declined 0.1 percent, a third monthly decline, and were unchanged in Beijing. Values continued to increase in Guangzhou, gaining 0.6 percent, the data showed.
A drop in land releases this year might keep pressure on prices in the capital.
Beijing this year plans to supply just 260 hectares of residential land, excluding government subsidized housing, down from 850 hectares last year, Beijing News reported, citing a government document.
While the bureau said home values “stabilized further” in mega and mid-size cities due to curbs, the government is likely to hold steadfast on cooling measures this year, Bloomberg Intelligence senior analyst Patrick Wong (黃智亮) said.
Further tightening of mortgage lending could come after at least seven local city governments stepped up existing buying curbs since December, Wong added.
Early private data showed residential transactions have been recovering slightly in large cites this month.
New home sales in key cities tracked by China International Capital Corp (中國國際金融) last week rose to a three-month high.
The People’s Bank of China vowed to “strictly limit” the flow of credit to speculative housing purchases in its fourth-quarter monetary policy report on Saturday last week.
Apart from adopting prudent monetary policies, the report encouraged “city-specific” credit conditions to ensure “reasonable” growth in housing mortgages.
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