China new home prices fall less in December on promotions, easing curbs

[BEIJING] China's new home prices fell more slowly in December than a month earlier, official data showed on Saturday (Jan 15), indicating stabilising demand driven by marginal easing on financing curbs, and promotions by property developers.

Average new home prices in China's 70 major cities declined 0.2 per cent in December from a month earlier, slower than a 0.3 per cent drop in November, according to Reuters calculations from data released by the National Bureau of Statistics (NBS).

China's property market has slowed since June 2021 as regulators stepped up their deleveraging campaign against the bloated sector, triggering defaults at some heavily indebted companies.

In December, authorities and property developers in multiple cities introduced measures to boost home sales, with local governments providing subsidies for home buyers and real estate firms offering discounts.

Monthly prices picked up in 15 of 70 cities, up from 9 cities that reported price gains in November.

New home prices rose 2.6 per cent year on year in December, slower than the 3 per cent growth recorded in November.

In a recent note, Oxford Economics analysts said they expect central and local authorities to take steps to contain risks from defaults by property developers, such as increasing credit to the sector and tweaking the strict "three red lines" policy introduced to curb borrowing by developers.

REUTERS