Slower gains for China's new home prices in April: private survey

CHINA’S April new home prices grew at a slightly slower pace compared with March gains, a private survey showed on Sunday (May 1), with policy-easing moves by local governments yet to significantly revive buying sentiment.

New home prices in 100 cities rose 0.02 per cent from a month earlier, easing from the 0.03 per cent gain in March, according to survey data from China Index Academy, one of the country’s largest independent real estate research firms.

More than 80 cities have taken steps to boost demand this year after the property market, a pillar of China’s economic growth, slowed sharply in 2021 due to Beijing’s crackdown on high leverage in the sector.

Sentiment has also been dampened by Covid-19 outbreaks across China this year, especially in Shanghai, which has endured a month of lockdown to block local transmissions of the virus.

Measures to encourage buying include subsidies, smaller down payments, reductions in mortgage rates and relaxation on rules for home purchases.

Some banks in the city of Zhangjiakou, 180 km north-west of capital Beijing, cut minimum down payments from Apr 18, according to state-backed Securities Daily.

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In April, banks in over 23 cities loosened limits on provident housing funds for certain home buyers.

Data from the China Index Academy survey showed 44 of the 100 cities surveyed reported gains in new home prices in April, compared with 37 cities in March.

“Policy has turned more supportive of housing demand and home sales should rebound once the virus situation improves,” research company Capital Economics said in a note last week.