China's new home prices stall amid crackdown on speculation

[BEIJING] China's new home prices stalled for the first time since February 2020 in September, official data showed on Wednesday, as the chill in the property market intensified amid a sustained crackdown on speculative investment.

The average new home price in 70 major Chinese cities was unchanged in September month-on-month, compared with 0.2 per cent growth in August, according to Reuters calculations based on data released by the National Bureau of Statistics (NBS).

The data also showed just 27 cities reported month-on-month gains, compared with 46 in August, the lowest since February 2020 at the height of China's Covid-19 outbreak.

In September, some cities intensified their campaigns to drive speculators out of the property market, with curbs such as caps on home purchase.

The south-eastern city of Xiamen further tightened its property curbs on top of existing measures, prohibiting first-time home buyers from reselling their properties for five years.

Chinese leaders, fearful that a persistent property bubble could undermine the country's long-term ascent, are likely to maintain tight property curbs, although analysts say they could soften some tactics as needed.

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Compounding concerns about the sector are the debt problems of China Evergrande, the country's second-largest developer, which is scrambling to raise funds to pay its many lenders and suppliers.

Compared with a year earlier, China's new home prices grew 3.8 per cent in September, the slowest in nine months, easing from a 4.2 per cent increase in August.

REUTERS