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China's new home prices pick up in April with broad-based gains

Momentum broadens across country despite raft of govt measures to prevent speculative investment

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New home prices in China's 70 major cities rose 0.5 per cent in April from the previous month, compared with a 0.4 per cent rise in March.

Beijing

CHINA'S new home prices rose in April for the 36th consecutive month, with momentum broadening across the country despite a raft of government measures to prevent speculative investment.

New home prices in China's 70 major cities rose 0.5 per cent in April from the previous month, compared with a 0.4 per cent rise in March, Reuters calculated from National Bureau of Statistics (NBS) data published on Wednesday.

That marks the highest monthly gain since June 2017, according to Reuters calculations. On an annual basis, home prices increased 4.7 per cent in April, slowing from a 4.9 per cent gain in March.

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Fifty-eight cities of the total 70 cities surveyed by the NBS reported higher prices in April, up from 55 cities in March, suggesting broader market strength despite persistent curbs to contain the still hot market.

China's house price growth started to cool more notably in the second half of last year as the government sought to deal with property bubbles, following a two-year expansion in the sector.

Authorities have introduced curbs in more than 100 cities since 2016, in a push to reduce bubble risks while ensuring a soft landing as real estate remains a crucial driver of the economy.

With signs that rapid housing growth in top-tier cities is cooling, regulators have this year turned their attention to smaller cities where there have been no purchase restrictions.

The Chinese southern provincial capital Guiyang issued restrictions this week banning newly-built houses from being resold within three years.

Price growth in China's second-tier cities, which include most of the larger provincial capitals, and smaller third-tier cities accelerated 0.1 percentage points and 0.2 percentage points, respectively, in April, the statistics bureau said. It did not give the actual rates of growth.

While some cities such as Shanghai, Nanjing and Wuhan have implemented a lottery system for home property purchases, smaller cities, like Ningbo, Xian and Hefei, are trying to attract talent by offering housing allowances.

Dandong, which lies on the border with North Korea, became the top price performer in April by rising a robust 2 per cent, NBS data showed.

Investors rushed into the city's property market after the historic inter-Korea summit last month opened the prospect of rapid improvement in relations between North Korea and the rest of the world.

Despite signs of market resilience, data showed on Tuesday China's property investment growth slowed in April as higher borrowing costs and increased curbs on buyers weighed on demand. REUTERS