China new home prices up moderately in December
Tightening government measures have cooled the market, with average prices in big cities rising 0.1% month on month
Beijing
CHINA'S new homes prices grew moderately in December, official data showed on Friday, as government measures aimed at cooling the property market took their toll.
Average new home prices in 70 major cities rose 0.1 per cent month on month in December, Reuters calculations of data from the National Bureau of Statistics (NBS) showed. The pace of growth was unchanged from November.
New home prices rose 3.8 per cent in December from a year earlier, slowing slightly from a 4.0 per cent increase in November.
China's property market has recovered quickly from the Covid-19 pandemic, thanks to local governments' relaxation on price ceilings and urban-residency permits. But the sharp rebound has raised concerns about financial risk, with the government stepping up efforts to deleverage a highly indebted sector since the second half of last year.
Regulators outlined borrowing caps known as "the three red lines" in August, followed by the central bank in December, which introduced caps on property loans issued by banks.
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The NBS data also showed that the number of cities reporting monthly price increases for new homes rose to 42 out of 70, from 36 in November.
Monthly gains were driven by price rises in Tier 1 cities, including Beijing, Shanghai, Guangzhou and Shenzhen, underscoring the deepening disparity in the market.
New home prices rose 0.3 per cent in Tier 1 cities. Second-hand home prices gained 0.6 per cent.
Zhang Dawei, an analyst with property agency Centaline, said an influx of population, which is common for big cities, growing speculative purchases and tight new home supply all contributed to the price gains in Tier 1 cities. He expects those cities to lead home price growth in China in the first quarter of 2021.
China saw uneven growth in home prices in 2020 as the wealthy made the most of easy credit during the coronavirus pandemic to buy property in eastern and southern coastal cities, while smaller cities grappled with an exodus of people and struggling local economies. REUTERS
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