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China home prices grow faster in April despite tightening in big cities

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China's home prices continued to grow from a year earlier at an accelerating pace in April despite tightening housing measures introduced in big cities, two private surveys showed.

[BEIJING] China's home prices continued to grow from a year earlier at an accelerating pace in April despite tightening housing measures introduced in big cities, two private surveys showed.

Prices of new homes in 100 cities last month rose an average 9 per cent from a year earlier, a poll by property services firm China Real Estate Index System (Creis) showed on Sunday, quickening from the 7.4 per cent rise in March.

In the biggest ten cities, including Shenzhen and Shanghai, home prices were up 14.4 per cent from a year ago, compared with 12.8 per cent in March. The increases in Shanghai and Shenzhen come despite local authorities tightening downpayment requirements for second homes and raising the eligibility bar for non-residents in late March.

However, compared with the previous month, prices rose 1.5 per cent in April, the survey showed, easing from 2.5 per cent in March.

Creis said home transaction volumes in Shenzhen and Shanghai have fallen after the tightening, and it expected the rise in prices would slow in the two cities.

A separate survey from Real Estate Information Corporation (Cric) showed average prices in the 288 biggest cities rose 7.2 per cent in April compared with a year earlier, improving from 5.6 per cent increase in March.

On a monthly basis, however, prices gained 1.5 per cent last month, faster than 1.2 per cent in March, said Cric, owned by E-House China Holding Ltd, showing smaller cities were increasingly posting price gains, helped by a slew of government measures.

While property prices in top-tier Chinese cities are booming, prices in smaller cities, where most of China's urban population lives, are still weakening, complicating government efforts to spread wealth more evenly and arrest slowing economic growth.

REUTERS